The Quick Read: Qualifying means documenting seasoned sale proceeds in eligible accounts, choosing one of two asset paths, and applying with statements and sale paperwork instead of tax returns, pay stubs or employment verification, while the lender sizes the cash-out against property value and your assets under its underwriting.
- Asset qualifier path: eligible assets, after the credit percentages, must cover the entire loan. Refinance leverage runs up to 75% loan-to-value on a principal residence or second home, while the lender sets whether cash-out is allowed on this path and at what leverage, which is not published.
- Asset depletion path: usable assets divided by 60 months become qualifying income. Cash-out runs up to 60% loan-to-value on a principal residence, second home or investment property, subject to underwriting.
- Privately held company stock is not an eligible asset on either path. The route is a sale or buyout converted to a documented cash balance.
- Cash-out proceeds never count as qualifying assets. The lender looks at what you already hold.
Why a Business Sale Confuses Ordinary Underwriting
A business sale leaves you wealthy on paper and thin on income. The proceeds are a one-time lump sum, not a paycheck. Your last tax returns show the business you no longer own, and the next ones may show a gain that looks nothing like steady earnings.
Standard income-based underwriting reads that picture badly. It wants a recent employment history, so a founder between chapters looks like a borrower with no income.
Asset-based mortgage programs fix this by changing what the lender measures. Instead of asking what you earn, the lender asks what you hold and whether those holdings are documented, seasoned and liquid. Across the wholesale network Lendmire works with, the asset-based mortgage programs are the place sellers, retirees and portfolio-funded households usually land when income is the weak link.
Every file is still fully underwritten. The documents change from tax returns and pay stubs to account statements and sale paperwork.
Key Terms Defined
Cash-out refinance: a new, larger mortgage that pays off the old one and hands you the difference in cash.
Asset qualifier: a path where eligible assets, after credit percentages, must equal or exceed the whole loan amount.
Asset depletion: a path that turns usable assets into a monthly qualifying income by dividing them over 60 months.
Seasoning: the length of time funds must sit in your account, shown by statements, before the lender counts them.
Debt-to-income (DTI): your monthly debts, including the new housing payment, compared with your monthly qualifying income.
Eligible asset: an account type the program accepts at a stated percentage of its balance.
How your file is reviewed on assets
You are qualified on one path at a time, never a blend of both. Which path fits depends mostly on loan size compared with your assets, and on whether you have any other documented income.
The asset qualifier path asks one question: do your eligible assets equal or exceed the entire loan? If yes, no employment or income needs to be documented. The asset depletion path asks a different one: can the monthly income created from your assets carry the housing payment and your other debts?
| Factor | Asset Qualifier | Asset Depletion |
|---|---|---|
| The test | Assets cover the whole loan | Assets ÷ 60 months run through DTI |
| Income documented | None | Derived from assets |
| Refinance leverage | Up to 75% (primary or second home) | 60% cash-out, any occupancy |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Investment property | Not offered | Yes, business-purpose |
| Seasoning | 60 days, two months of statements | Statements 120 days old plus one within 45 days; sale-of-business funds are excused from the 120-day seasoning |
| Credit | 600 minimum score | The lender’s matrix |
Two details in that table matter for cash-out. On the qualifier path, the 75% figure is the published refinance leverage, and the lender decides whether cash-out proceeds are allowed and at what leverage; that limit is not published. Ask for it before you plan around it. On the depletion path, cash-out is published at 60% loan-to-value on a principal residence, second home or investment property, subject to underwriting.
If your goal is pulling equity from a rental you own, the depletion path is the one built for it. An investment-property loan is a business-purpose loan, so it is reviewed differently from an owner-occupied mortgage.
What Counts After a Sale, and What Does Not
Each account type counts at a share of its balance. The part that does not count is the haircut. Programs set these percentages by path, so never apply one table to the other.
| Asset | Qualifier Path | Depletion Path |
|---|---|---|
| Brokerage / securities | 100% | 80% |
| Certificates of deposit | 100% | 100% |
| Money market and savings | 100% | 100% (cash accounts) |
| Retirement, under 59½ | 90% | 70% |
| Retirement, 59½ or older | 100% | 70% |
| Real-estate equity | Not listed | 60% |
Accounts combine on the qualifier path, so a brokerage account, a savings account and a retirement account can all contribute to one total.
Privately held company stock is not an eligible asset on either path. That includes shares in the company you just sold if you took stock instead of cash, and any stake you kept in a partial sale. The documented route is a sale or buyout converted to a seasoned cash balance in a regulated account.
Several other things are not published as eligible on either path:
- Cryptocurrency, precious metals and collectibles.
- Business accounts beyond your documented ownership share.
- Pledged or borrowed funds.
The documented route for any of these is to convert the holding to cash in a regulated account and let the statements season, after which the lender reviews the source.
The depletion path also excludes these specific accounts:
- Escrow accounts.
- Custodial accounts.
- Deferred compensation.
- Foreign funds.
- Cash on hand.
- Stock options.
- Non-vested restricted stock units.
- Funds from non-regulated financial companies.
That list matters to sellers. A holdback sitting in escrow is not an eligible asset until it is released into your own regulated account.
Gross proceeds are also not the same as usable assets. Set aside what you owe from the sale before counting anything, because the lender looks at the balance actually in your accounts. Tax treatment varies; consult a qualified professional.
Three Worked Examples
These shapes show how raw balances become usable assets. The lender’s own calculation governs, and every file is subject to underwriting.
Qualifier path. Say you want an $800,000 loan. You hold $330,000 in brokerage accounts, $300,000 in a 401(k) and $200,000 in savings, and you are under 59½.
- Brokerage counts at 100%, which is $330,000.
- The 401(k) counts at 90%, which is $270,000.
- Savings counts at 100%, which is $200,000.
That totals $800,000 of usable assets. The assets alone equal the loan, so the file is reviewed on assets with no income documented. Add more savings and you gain cushion. Remove the retirement account and you fall short.
Depletion path. Now 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.
Usable assets are $1,500,000. Divide by 60 months and you get $25,000 of monthly qualifying income. That income must carry the new housing payment and your other debts through the debt-to-income test. The balance also clears the minimum-assets rule, which is the lesser of $1,000,000 or 1.25 times the loan balance.
The comparison is the point. The qualifier path needs assets as large as the loan, so it suits a big liquid balance against a modest loan. The depletion path needs less raw asset volume but adds a DTI test and a cash-out leverage cap.
How to Apply, Step by Step
1. Pick the path. Compare your loan target with your usable assets. If assets cover the whole loan after the credit percentages, the qualifier path is the cleaner fit, though cash-out terms on it are set by the lender. If you want published cash-out leverage or the loan is on an investment property, plan on the depletion path.
2. Move the proceeds into a regulated account. Cash from the sale should land in your own bank or brokerage account. Keep the purchase agreement, the closing or settlement statement and the wire or deposit trail together, because the lender reviews the source of the funds.
3. Clean up the asset list. Sort holdings into eligible and ineligible using the table above. Convert crypto, metals, collectibles or private-company shares to cash if you plan to use them, and let the statements season.
4. Gather statements. The qualifier path wants two months of statements for every qualifying account. The depletion path wants statements at least 120 days old at application plus the most recent one within 45 days.
5. Check credit and housing history. The qualifier path publishes a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix, and a first-time investor on that path needs 700.
6. Apply through a broker who sees several lenders. Lendmire arranges asset-based mortgages through select lenders in its network. It does not lend or approve; the lender underwrites and decides.
7. Property work. Expect title and payoff, an appraisal, and a determination of how you will occupy or use the property. Rent-based appraisal forms matter only when a loan is underwritten on rent.
8. Review the net. The new loan minus the payoff, costs and any reserves is what you keep. Those proceeds cannot be re-counted as qualifying assets.
Timing After the Sale: When the Money Is Ready to Count
On the qualifier path, funds need 60 days of seasoning with two months of statements. If the proceeds arrived last week, the statements will not show it.
On the depletion path, the statement-age rule is relaxed for sale-of-business funds, along with inheritance and legal-settlement funds. A fresh sale balance does not need to wait out the 120-day statement window. The rest of the file still has to meet the program’s guidelines.
The practical advice is to choose the path first and let that tell you how long to leave the money alone. Sitting still is the safest thing a balance can do.
Mistakes That Stall or Sink These Files
These are mechanics, not statistics. Each one breaks a documented rule in the program.
- Moving money between accounts mid-file. Statements then show transfers the lender must trace, and two clean months of history is a qualifier-path requirement.
- Spending proceeds before the loan is underwritten. On the qualifier path, a balance that drops below the loan amount ends the qualification.
- Counting cash-out as an asset. The new loan’s proceeds cannot be counted toward qualifying on either path.
- Misreading how the loan is reviewed. The loan is reviewed on verified assets rather than income documentation, subject to lender guidelines, and both paths still document assets, credit, property and source of funds.
- Mixing the paths. The qualifier tables and the depletion tables are separate. Combining them overstates what counts.
- Using the wrong path for the property. Investment property is offered only on the depletion path.
Edge Cases Where the General Rule Bends
Seller note or installment sale. Only payments you have received and deposited count. The note itself is a receivable, not a listed eligible asset.
Earn-outs and holdbacks. Money sitting in escrow is excluded on the depletion path. Once it is paid out and sits in your regulated account, it is ordinary cash.
Stock as part of the price. If the buyer paid partly in privately held stock, that stock is not an eligible asset on either path. Only the cash you receive and any public securities you hold count.
Business accounts. Funds in an account the company still owns count only for your documented ownership share, and the broader asset-class rules still apply.
Consulting or part-time income. Asset-derived income can supplement documented income on the depletion path up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived.
Thin liquid balance. On the depletion path, qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When depletion is your only income source, you also need at least $250,000 liquid.
Credit events. Multiple bankruptcies are not eligible. A housing event needs four years of seasoning on the depletion path.
Does Asset-Based Mean No Documentation?
No. Asset-based means no income documents, not no documents. The federal ability-to-repay compliance guide lists eight factors a lender must consider on a consumer mortgage, and income or assets is one of them. The Federal Register final rule adds that the determination must rest on verified and documented information.
That is why statements, source-of-funds paperwork and a full credit review are part of every asset-based file. A lender can rely on assets in place of income, but it still has to see them.
When Another Product Fits Better
| Option | How it qualifies | Best fit |
|---|---|---|
| Asset-based mortgage | Documented liquid assets | Cash-rich, income-light sellers |
| DSCR loan | Rent covers the payment | Business-purpose rentals |
| Bank statement loan | Deposits document income | Owners still earning |
| Full-doc jumbo or conventional | Tax returns and pay history | Borrowers with steady income |
| HELOC | The home lender’s own rules | Smaller draws on existing equity |
A DSCR cash-out underwrites a rental’s income against its payment, so coverage falls as you pull more cash. That can make it a poor match when rent coverage is thin. Asset-based underwriting does not depend on the rent, so a seller with strong liquid assets and a lightly rented property may compare both.
A bank statement program is for borrowers who document income with deposits. If you are still earning, it may work. If the sale ended your income, it will not.
Waiting can also be the right call. If the sale funds are still tied up in escrow or a seller note, you may be better off letting them season and pay out.
Pre-Application Self-Check
Run through these before you ask for terms:
- Do your sale proceeds sit in your own regulated account?
- Do you have your purchase agreement, settlement statement and wire trail?
- Have you subtracted what you owe from the sale before counting your balance?
- Is any of your balance privately held stock, crypto, metals or escrow? If so, plan to convert it to cash.
- Do your statements meet the path’s seasoning rule?
- Does your credit fit the path’s matrix, and is your housing history clean?
- Is the property a primary home, a second home or an investment property, and does your path allow it?
Frequently Asked Questions
Can I get a cash-out refinance with no job after selling my business?
Yes, through select programs, because the lender can rely on documented assets in place of income. You will need seasoned statements, sale paperwork and credit that fits the path, and the loan is subject to underwriting. Approval is never assured.
Does my privately held company stock count toward qualifying?
No. If you sold the company, the cash from the sale counts once it is in a regulated account and meets the path’s statement rules.
Which path is better after a sale?
It depends on the loan size and the property. The qualifier path suits a large liquid balance against a modest loan, and the lender sets its cash-out terms. The depletion path suits an investment property or a lower asset-to-loan ratio, with published cash-out leverage of 60%. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
Do I need to wait after the business sale closes?
It depends on the path. The qualifier path wants 60 days of seasoning and two months of statements. On the depletion path, sale-of-business funds are excused from the statement-seasoning rule.
Can I use my retirement account?
Yes. On the qualifier path, retirement balances count at 90% under age 59½ and 100% at 59½ or older. On the depletion path, they count at 70% at any age.
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. Consumer mortgage lending is available in Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Programs change, and every file is underwritten individually.
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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References
1. CFPB ability-to-repay and qualified mortgage compliance guide
2. Federal Register: Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How to Qualify and Apply for an Asset-Based Cash-Out Refinance With Six Months of Reserves · How to Qualify and Apply for an Asset-Based Cash-Out Refinance on a Non-Warrantable Condo
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.