The Quick Read: Through select programs, a cash-out refinance at 60% loan-to-value is underwritten on the asset depletion path, where the lender turns your documented liquid assets into monthly qualifying income, caps the new loan at 60% of the appraised value, and tests the full housing payment against that income, subject to underwriting.
- The 60% cap applies on this path to a cash-out refinance on a principal residence, a second home, or an investment property.
- Usable assets are divided by 60 months to create qualifying income, and that income runs through a debt-to-income test.
- Cash you take out of the new loan never counts as a qualifying asset.
- You document the assets with statements, but you submit no traditional personal-income documentation, pay stubs or employment verification.
- Every figure here is a ceiling or floor from select programs, not an offer, and each file is underwritten individually.
This is written for cash-heavy, income-light borrowers. Think retirees, people who sold a business, heirs, early-retired professionals, and households living on a portfolio. Your balances are large, and your documented income is small. A conventional lender looks at your paycheck and sees very little, while an asset-based lender looks at your statements and sees plenty.
Lendmire is a mortgage broker. It places these files with select lenders in its wholesale network, and those lenders do the underwriting. What follows is how that underwriting works, step by step.
What “Asset-Based” Means (and Which Meaning This Is)
The phrase gets used for three different things. Here, it means qualifying a borrower on the borrower’s own assets instead of on employment income.
Some lenders use “asset-based” to mean lending against the property alone, as hard money and bridge lenders do. Others mean a rental loan that is reviewed on the property’s rent. This article covers neither. It covers the asset-based mortgage, where your brokerage accounts, savings, certificates of deposit and retirement balances do the qualifying.
That program has two paths, and you are qualified on one at a time:
- Asset qualifier path: Eligible assets, after the credit percentages, must equal or exceed the entire loan amount. No employment or income is documented.
- Asset depletion path: Eligible assets, after the haircuts, are divided by 60 months into a monthly qualifying income. That income must carry the housing payment and your other debts.
Here is the part that matters for this title. Cash-out at 60% loan-to-value is a depletion-path structure. On the qualifier path, whether cash-out is allowed, and at what leverage, is set by each lender and is not published. So this article does not give you a qualifier-path cash-out figure, and you should not trust one from anyone who offers it without a specific program in hand. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Learn more about asset-based mortgage programs if you want the full program overview before the mechanics.
Key Terms Defined
Cash-out refinance: A new mortgage larger than the old one, with the difference paid to you as cash after the old loans are paid off.
Loan-to-value (LTV): The new loan amount divided by the appraised value of the property.
Asset depletion: A method that spreads eligible assets over 60 months to create a monthly qualifying income.
Haircut: The part of an asset’s balance that does not count toward qualifying. A 20% haircut means 80% of the balance counts.
Seasoning: How long funds must have sat in your account, shown on statements, before the lender will count them.
Debt-to-income (DTI): Your monthly debts, including the new housing payment, divided by your monthly qualifying income.
Principal residence and second home: Owner-occupied properties. The loan on them is a consumer mortgage.
The Underwriting Sequence, Step by Step
Underwriters work in a fixed order. Each step can shrink the loan or stop the file, and a later step never rescues a failed earlier one.
1. Classify the transaction. The lender confirms this is a cash-out refinance, not a rate-and-term refinance. It also confirms the occupancy: principal residence, second home, or investment property. Occupancy changes the leverage cap on every path.
2. Place you on a path. A cash-out at 60% runs on the depletion path. You are qualified on that path only, and the two tables are never blended.
3. Order the appraisal and set the ceiling. Appraised value times 60% is the largest loan the lender will write. A low appraisal lowers that ceiling.
4. Size the payoff. The new loan must pay off your existing first mortgage and any junior liens, such as a home equity line, plus closing costs. What remains is your cash.
5. Document and season the assets. The lender reads your statements. They must be at least 120 days old at application, and the most recent must be within 45 days. Funds from a business sale, inheritance or legal settlement are excused from that seasoning.
6. Apply the haircuts. Each asset type is counted at its allowed share. Ineligible assets drop out entirely.
7. Convert to income. Usable assets divided by 60 months gives monthly qualifying income.
8. Run the DTI test. The full new housing payment and your other monthly debts must fit within the program’s limit against that income.
9. Check credit and housing history. Credit follows the lender’s score and loan-amount matrix. Housing history is reviewed as well.
10. Clear the property file. That means title, insurance, and the occupancy and purpose documents, then final conditions. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
The loan you get is the smallest result among the 60% cap, the loan-amount limits, and what your qualifying income supports. People are often surprised to learn that the cap is rarely the binding one for asset-rich borrowers. The income test is usually where the file gets tight.
How the 60% Cap Sizes Your Cash
Sixty percent is a conservative leverage point, and it works as a ceiling, not a target. The cash you receive is what is left after the payoff.
Run it in percentages. Say your home appraises at 100 units of value, and your existing mortgage and any line of credit total 35% of that value. A 60% cap leaves room for cash equal to up to 25% of the value, before closing costs. If those existing liens total 55%, only 5% of the value is left, and costs will take some of it.
Three practical points follow.
- A low appraisal cuts cash twice. The ceiling falls, while your payoff stays the same.
- A line of credit counts. An open home equity line is a junior lien. It is paid off at closing from the new loan, so it eats into your cash.
- A free-and-clear property still counts as cash-out. Any cash you take is a cash-out refinance, even with nothing to pay off.
Loan amounts on the depletion path run from $125,000 to $3,500,000, through select programs and subject to underwriting. A very small loan falls below the floor, and a very large one falls above the ceiling.
The cap is the same 60% whether the property is your residence, a second home or an investment property. The difference shows up elsewhere. On the depletion path, a purchase or rate-and-term refinance is capped at 80% on a principal residence or second home, but only 65% on an investment property. Cash-out narrows that gap to one number.
How Your Assets Are Counted
On the depletion path, each asset type counts at a share of its balance. This table shows the share that counts.
| Asset type (depletion path) | Share that counts |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Retirement accounts (any age) | 70% |
| Real-estate equity | 60% |
Not eligible on this path: custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, non-vested restricted stock units, and funds from non-regulated financial companies. Privately held company stock is not an eligible asset on either path.
Cryptocurrency, precious metals, collectibles, business accounts beyond your ownership share, and pledged or borrowed funds are not published as eligible on either path. If you hold those, the documented route is converting them to a seasoned cash balance in a regulated account. The lender then reviews where the money came from.
The Depletion Math
Here is the illustrative arithmetic, and the lender’s own calculation governs. Say you hold $1,500,000 in securities and $300,000 in cash. Securities count at 80%, which is $1,200,000. Cash counts at 100%, which is $300,000. Your usable assets are $1,500,000.
Divide by 60 months. That gives $25,000 of monthly qualifying income. That income then has to carry your housing payment and other debts through the debt-to-income test.
Two program minimums sit beneath this. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. They must also never fall below $250,000 liquid when asset depletion is your only income source. If you also have documented income, asset-derived income can supplement it up to a 45% debt-to-income ratio. In that case, the minimum-assets rule is waived.
The Qualifier Path, for Contrast
The qualifier path counts differently. Brokerage accounts, certificates of deposit, money market and savings count at 100%. Retirement accounts count at 90% under age 59½ and 100% at 59½ or older.
Say you want an $800,000 loan. You hold $330,000 in brokerage accounts, $300,000 in a 401(k) under 59½, and $200,000 in savings. That counts $330,000, then $270,000, then $200,000, for $800,000 of usable assets. The assets cover the whole loan, so the file is reviewed on assets alone. It needs 60 days of seasoning, with two months of statements per account. There are no required reserves at or below 75% loan-to-value on a refinance.
That is a strong path for a purchase or a standard refinance. For cash-out, ask the broker which lenders allow it, because the answer is lender-specific.
Why Cash-Out Proceeds Never Count
Cash from this loan cannot be used to qualify for this loan. It also cannot count toward a follow-on loan under the depletion path’s rules.
The logic is simple. The new loan creates the debt and the cash at the same moment. Counting the cash as an asset would let a borrower qualify on borrowed money. The lender wants assets that existed before the file started, and the seasoning rules enforce that.
So plan your assets as they stand today. Do not plan to stack one cash-out on top of another and count the first as the base for the second.
The Property Side
Even though your assets carry the income test, the property still has to pass. The appraisal sets the value. Title must be clean enough to insure. Insurance must be in place. For an investment property, the lender will also want its business-purpose and occupancy paperwork.
Here is the one regulatory point worth knowing. Credit extended to acquire or improve non-owner-occupied rental property counts as business-purpose credit, according to the CFPB’s Truth in Lending examination procedures. Business-purpose loans are reviewed differently from an owner-occupied mortgage. But a Hunton Andrews Kurth analysis cautions that business purpose does not mean compliance-free. That is why lenders ask you to certify how the property is used and what the funds are for. Answer those forms carefully and consistently.
What You Still Document
This is not a loan without paperwork. The lender skips traditional personal-income documentation, pay stubs and employment verification. It does not skip documents.
- Account statements covering every asset you are counting, meeting the seasoning and age rules above
- A source explanation for any large deposits
- The appraisal and the payoff statements for every lien being paid off
- Title and insurance
- Credit, plus housing history of 0x30x12, meaning no 30-day lates in the last twelve months (one late is considered case by case)
- Occupancy and, for investment property, business-purpose certifications
Credit follows the lender’s score and loan-amount matrix on the depletion path. A first-time investor on this path needs a 700 score. Multiple bankruptcies are not eligible, and a housing event such as a foreclosure needs 4 years of seasoning on the depletion path. Nothing here removes the credit review.
Where the Rule Breaks
The general rule is clean: 60% cap, assets divided by 60 months, DTI test. Here is where real files bend it.
You are under 59½ with most of your money in a retirement account. The depletion path counts retirement accounts at 70% at any age. The qualifier path is kinder at 90% under 59½ and 100% after, but it does not publish a cash-out figure. So you may have to choose between a better asset credit and the cash-out you want.
Your wealth is in a private company. The route is a sale or buyout that converts the shares to a seasoned cash balance. Funds from a business sale are excused from the standard seasoning on the depletion path.
Your wealth is in crypto, metals or collectibles. None are published as eligible. Convert them to cash in a regulated account first, and expect the lender to review the source.
Your assets are large, but not large enough. You need qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan, and never below $250,000 liquid if assets are your only income. A $1,000,000 loan needs at least $1,000,000 in qualifying assets, so the lesser-of rule can stop a file that looks comfortable.
Your documented income is real but modest. If you have a pension or Social Security, the asset-derived income can supplement it up to a 45% DTI. The minimum-assets rule is waived when it does.
You are a first-time investor on an investment property. The 700 score requirement applies on the depletion path.
Your statements are too new. Statements must be at least 120 days old at application, plus one within 45 days. Money moved in last month does not meet the age rule, unless it is business-sale, inheritance or settlement money, which is excused.
Which Path Fits You
Choose by what you hold and what you need.
- If your assets can cover the whole loan outright and you are buying or refinancing without cash-out, the qualifier path is worth a look. Ask the broker whether a lender in the network allows cash-out on it.
- If you want cash out at 60% loan-to-value and your assets are large, the depletion path is the one built for it.
- If you have meaningful documented income, even modest, the depletion path can supplement it. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
The best program for your situation depends on the property, your credit profile, how much cash you want, and which assets you hold. A broker that shops several wholesale lenders can match those facts to the program that fits.
How It Compares to Other Cash-Out Routes
| Route | What the lender underwrites | Best fit |
|---|---|---|
| Asset depletion cash-out | Your usable assets as income | Large balances, little income |
| Bank statement cash-out | Deposits as income | Self-employed with strong deposits |
| DSCR cash-out | The rental’s income against its payment | Investment property that rents well |
| Hard money or bridge | The property and exit plan | Short-term needs |
Each of those programs follows its own rules, and none of its figures apply here. If your rental property carries the income, DSCR is the business-purpose route. Asset-based underwriting is the route when your statements are stronger than your paychecks or your rent.
Across the wholesale network Lendmire works with, the files that run smoothly share one trait. The borrower brings statements that are already seasoned and a payoff figure that is already known. The files that stall usually have a balance that arrived recently, or a line of credit nobody remembered to count.
Frequently Asked Questions
Can I take cash out on the asset qualifier path?
That is set by the lender and is not published, so no figure can be stated. Cash-out at 60% loan-to-value is the published structure on the depletion path. If you want cash out and prefer the qualifier path’s more generous asset credit, ask the broker to check which lenders in the network allow it. Any answer is subject to underwriting.
Do cash-out proceeds count as assets for qualifying?
No. Cash from the new loan never counts as a qualifying asset on the depletion path. Only assets that existed and were documented before the file began are counted.
Can a founder qualify with private-company stock alone?
No. The route is documented liquid assets: seasoned proceeds from a sale or conversion, cash, public securities and retirement accounts at their allowed shares.
Does this work for an investment property?
Yes, on the depletion path, through select programs. A cash-out refinance on an investment property is capped at 60% loan-to-value, the same cap as on a principal residence or second home. Because it is a business-purpose loan, the lender will ask for occupancy and purpose certifications, and everything remains subject to underwriting.
Is the program available in my state?
Lendmire’s consumer mortgage lending is licensed in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Outside those states, this program is not available through Lendmire.
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. Programs change, every file is underwritten individually, and nothing here is a commitment to lend. Reach the team at 828-256-2183 or request a quote through the site.
A 60% ceiling leaves a thick equity cushion after closing, and for most asset-rich borrowers the real planning question is not how high the cap goes but how much cash the payoff leaves.
For how equity extraction works on an investment property, see Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging bank statement and other alternative-documentation mortgages — P&L-only, 1099-only and asset-based paths — through a wholesale lending network. Eligibility is determined by the lender on each file. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. CFPB – Truth in Lending examination procedures
2. Hunton Andrews Kurth – Beware of Business Purpose
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Asset-Based Cash-Out Refinance Requirements on a Primary Home · Asset-Based Cash-Out Refinance Lenders When the Property Is Owner-Occupied · Best Asset-Based Cash-Out Refinance Program After Your Home Value Jumps
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
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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.