The Quick Read: Your verified savings and investments carry the loan, either by covering the full loan amount outright or by being converted into monthly qualifying income, so paychecks and traditional personal-income documentation are not the deciding evidence, though the property still has to pass a second-home occupancy test.
- The asset qualifier path covers the entire loan with eligible assets and documents no employment or income.
- The asset depletion path divides usable assets by 60 months to create qualifying income, which then runs through a debt-to-income test.
- You are qualified on one path at a time, never a blend of the two.
- Assets are documented with statements on both paths. Only the income documentation goes away.
- Rental income generally does not help a second-home file. If rent is central to your plan, the file belongs on a rental-property loan instead.
What Is an Asset Qualifier Mortgage on a Vacation Home?
It is a consumer mortgage for a home you will use yourself, qualified on what you own instead of what you earn. People also call it asset depletion, asset utilization, or asset-based qualification. Those labels overlap, and in Lendmire’s wholesale network they describe two distinct paths with different math.
The fit is a household with large balances and thin documented income. Think of a retiree living off a portfolio, someone who just sold a business, or a person who received an inheritance or a settlement. An early-retired professional fits too. A cabin outside Taos or a casita near Santa Fe is the kind of purchase these borrowers often want, and a lender looking only at last year’s tax return would see very little.
Lendmire is a mortgage broker. It arranges these loans through select lenders in its network, and it is licensed for consumer mortgage lending in 16 states, New Mexico among them. The lender, not the broker, reviews and approves each file. Every figure below is a ceiling or floor under select programs, subject to underwriting, and not an offer.
Which Path Fits You?
Pick the path first, because every number that follows depends on it. Start with one question: do your eligible assets equal or exceed the entire loan amount?
Asset qualifier path. If the answer is yes, this is the cleaner route. Eligible assets, after the credit percentages in the next section, must equal or exceed the whole loan. No employment or income is documented. Loans run up to $4,000,000, and leverage reaches 80% loan-to-value on a purchase and 75% on a refinance of a principal residence or second home.
Asset depletion path. If your assets are large but fall short of the loan amount, this path may fit. Usable assets are divided by 60 months to create monthly qualifying income. That income must carry the full housing payment and your other debts through the debt-to-income test. Loans run from $125,000 to $3,500,000. On a second home, leverage reaches 80% on a purchase or rate-and-term refinance and 60% on a cash-out refinance.
Both paths are subject to underwriting. Neither is a promise. Cash-out proceeds never count as qualifying assets on the depletion path. Whether the qualifier path allows cash-out at all is set by the lender, so treat it as unavailable until a lender confirms otherwise.
How Underwriting Treats Your Assets, Step by Step
Underwriting follows the same general sequence on both paths, with different math at the end.
1. Pool the accounts. You list the accounts you want to qualify on. Balances in the same asset class combine.
2. Document them. Statements prove the balances. On the qualifier path that means two months of statements per account and 60 days of seasoning. On the depletion path the statements must be at least 120 days old at application, plus a recent statement within 45 days.
3. Remove the deal’s own demands. The same dollars cannot pay your down payment and closing costs and also count as qualifying assets. Lenders work from what remains.
4. Apply the credit percentages. Each account type counts at a set share of its balance. Those shares differ by path, and the tables below keep them apart.
5. Run the path’s test. The qualifier path compares usable assets to the whole loan. The depletion path converts usable assets to monthly income and runs the debt-to-income test.
6. Check credit, leverage, occupancy, and the property. A second home carries tighter leverage and an occupancy test.
Seasoning is the waiting period that proves money is really yours. Funds from the sale of a business, an inheritance, or a legal settlement are excused from the depletion path’s seasoning rule.
Asset credit on the asset qualifier path
| Asset | Share that counts |
|---|---|
| Brokerage accounts | 100% |
| Certificates of deposit | 100% |
| Money market and savings | 100% |
| 401(k) and IRA, under age 59½ | 90% |
| 401(k) and IRA, age 59½ or older | 100% |
Asset credit on the asset depletion path
| Asset | Share that counts |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
The depletion path does not accept custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, non-vested restricted stock units, or funds from non-regulated financial companies.
What the Math Looks Like
These two examples are illustrative. The lender’s own calculation governs.
Qualifier path. Say you want an $800,000 loan. You hold $330,000 in brokerage accounts, which count at 100%, so $330,000. You hold $300,000 in a 401(k) and you are under 59½, so it counts at 90%, which is $270,000. You hold $200,000 in savings, which counts at 100%, so $200,000. Together that is $800,000 of usable assets. The assets alone cover the loan, so the file can qualify on assets alone, subject to underwriting.
Depletion path. Say you hold $1,500,000 in securities, counted at 80%, which is $1,200,000. You also hold $300,000 in cash, counted at 100%. Usable assets total $1,500,000. Divide by 60 months and you get $25,000 of monthly qualifying income. That income then has to carry the housing payment and your other debts through the debt-to-income test.
Notice what the depletion path counts. The lender counts the portfolio itself, spread over time, not the interest or dividends it throws off. Your holdings are qualified against, not sold. You keep them.
On the depletion path, minimum qualified assets are the lesser of $1,000,000 or 1.25 times the loan balance. When asset depletion is your only income source, the floor never drops below $250,000 liquid. Asset income can also supplement documented income up to a 45% debt-to-income ratio, and the minimum-assets rule is waived in that case.
Credit, Leverage, and Reserves
The qualifier path has a published 600 minimum credit score. The depletion path follows the lender’s matrix of score and loan amount, so ask for that matrix instead of guessing a number. A first-time investor on the depletion path needs a 700 score. Housing history is 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. A housing event needs four years of seasoning on the depletion path.
Reserves differ by path. The qualifier path requires none at or below 75% loan-to-value, and above that the lender sets them. The depletion path has no published reserve months.
Leverage on a New Mexico second home is the same as anywhere else. Program figures do not change by state. Only the local facts around them change, such as prices and property types.
Where the Rule Breaks: Second Home or Rental?
This is the edge case that sinks the most vacation-home plans. A second home is one you occupy for your own use. Lenders generally do not count rent on a second home toward qualifying. They may note it, but it typically carries no weight.
Occasional rental keeps the file a second home. Listing the place on a booking platform for most of the season and counting on payouts to carry the payment does not. Heavy rental invites reclassification as an investment property, and that changes the leverage, the credit rules, and sometimes the program. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income. Santa Fe, for instance, runs its own short-term rental permit and registration ordinance, so a property that could be an Airbnb may not legally be one.
The honest decision rule has two branches:
- Personal retreat, rare rental. The asset route on second-home terms fits. Rent will not help the file, so do not plan around it.
- Rent is central to the plan. Move to a DSCR loan. DSCR qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Your complete DSCR loans guide is at this overview of DSCR loans. Do not try to blend the two structures.
On a depletion-path investment property, leverage drops to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. That is a different file from a second home, and it is a reminder that classification drives the numbers.
Vesting matters too. Asset-based loans are typically personal-name products. DSCR loans can often close in an LLC, subject to program terms. Tax treatment varies; consult a qualified professional.
Which Loan Path Suits a New Mexico Second Home?
Other programs exist, and each has its own rules. This table describes those programs, not the asset-based paths above.
| Path | Best for | Income documented | Rent on a vacation home |
|---|---|---|---|
| Asset qualifier | Assets cover the loan | None | Generally not counted |
| Asset depletion | Large assets, loan above them | Derived from assets | Generally not counted |
| Bank statement | Self-employed with deposits | Bank deposits | Not the basis |
| DSCR | Rental-driven purchase | Property rent | Central |
| Full-doc conventional or jumbo | Strong documented income | Traditional personal-income documentation, W-2s | Per that program |
Choosing is mostly a question of what you can document. If your deposits show income but your returns do not, the bank statement program is built for that. The asset paths fit when your balance sheet is the strongest thing you have. When eligible assets cover the whole loan, the qualifier path may fit, since it asks nothing about income. When assets fall short of the loan, the qualifier path is not available, and the depletion path is the asset-based option to look at.
New Mexico Property Issues That Reach the Appraisal
New Mexico vacation homes often sit in places with their own quirks, and a few of them reach the appraisal and underwriting. Think of road access, well and septic systems, water rights, adobe or historic-district construction, and HOA or condo status. Insurance availability can also be a question in wildfire-prone areas. None of these change the program figures. They can slow or stall a file if they surface late, so raise them early with your broker.
Resort markets also tend to sell more slowly than city markets. Redfin’s Taos housing data shows homes sitting longer than they did a year earlier. For you, that is a reminder to size your asset pool with room to spare.
What Does Not Count
A few things catch buyers off guard.
- Your down payment. It is not a qualifying asset. The pool is measured after the funds to close are set aside.
- Cryptocurrency, precious metals, collectibles, and borrowed or pledged funds. None is published as eligible on either path. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
- Business accounts beyond your ownership share. Only your share is considered.
- “No documents” thinking. The loan is built on documented assets. Only the income paperwork is absent, and only on the qualifier path.
A few words on the legal frame, kept short. Because this is a consumer mortgage, the lender must make a reasonable, good-faith determination that you can repay it. The CFPB’s ability-to-repay rule requires that. Assets can support that determination, and the lender verifies the assets it relies on. That is why the statements matter.
Key Terms Defined
Asset qualifier path: the route where eligible assets must equal or exceed the entire loan amount, with no income documented.
Asset depletion path: the route where usable assets divided by 60 months become monthly qualifying income.
Seasoning: the waiting period that shows funds have been yours, rather than recently moved in.
Debt-to-income ratio: your monthly debts, including the new housing payment, compared with your qualifying monthly income.
Loan-to-value: the loan amount as a share of the property’s value.
Putting It Together: What to Do Next
Run the sequence in this order. First, total your eligible assets by account type and apply the right path’s percentages. Second, decide which path fits by comparing usable assets to the loan you want. Third, set your occupancy plan honestly, since it decides whether a second-home file or a rental file is right. Fourth, gather your statements, with two months per account for the qualifier path. Fifth, check your property for access, water, and HOA issues before you write an offer.
If you want a similar walk-through for a different property type, Lendmire’s guide How to Finance a Second Vacation Home on Asset Depletion covers a nearby situation.
The honest costs are real. These loans are underwritten individually through select lenders, and terms are not the same as a conventional loan’s. Going this route makes sense when your assets are your strongest evidence, not when a simple full-doc loan would do.
Frequently Asked Questions
Can I use an asset qualifier mortgage for a vacation home?
Yes, on a second home, subject to underwriting. The qualifier path reaches 80% loan-to-value on a purchase and 75% on a refinance of a principal residence or second home. The depletion path allows second-home purchases up to 80% as well.
Do I need traditional income documentation or a job?
On the qualifier path, no employment or income is documented. On the depletion path, your assets are converted into qualifying income, so no paycheck is needed when assets are your only source. Your assets are always documented with statements.
Do retirement accounts count?
Yes. On the qualifier path, 401(k) and IRA balances count at 90% under age 59½ and 100% at 59½ or older. On the depletion path, retirement accounts count at 70% at any age.
Can I rent the property out?
Occasional rental keeps it a second home, but rent generally does not help you qualify. Heavy rental can reclassify the file as an investment property with different leverage and rules. Confirm local rental rules before relying on any income.
Is this the same as a DSCR loan?
No. Asset-based loans look at your balance sheet. DSCR loans look at the property’s rent. DSCR suits a rental-driven purchase on investment-property terms.
Next Step
If you are qualifying on assets rather than income and want to see how the numbers work, Lendmire can help you compare asset-based mortgage options based on your statements, the property, credit profile, leverage, and your goals.
Lendmire’s asset-based mortgage in New Mexico page presents the program for New Mexico borrowers.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. City of Santa Fe – Ordinance 2020-35
2. Redfin – Taos housing market
3. CFPB – Regulation Z §1026.43, Ability-to-Repay
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Get an Asset Depletion Mortgage After a Foreclosure or Short Sale? · Asset Depletion Mortgage vs HELOC on a Paid-Off Home · How an Asset Depletion Mortgage Works
Guides: Asset-Based Mortgage in New Mexico
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.