The Quick Read: Only when your eligible assets, after the credit percentages, add up to at least the entire loan on their own and your monthly debts or thin income would make a debt-to-income test hard to pass, since the qualifier path documents no income or employment at all. If the assets fall short of the loan, or the property is an investment property, the asset depletion path is the one to run. Both are available only through select programs and subject to underwriting.
- Qualifier path: the assets must equal or exceed the whole loan, and no income is documented.
- Depletion path: usable assets are divided by 60 months to create qualifying income, which then goes through the debt-to-income test.
- Leverage: up to 80% on a purchase on the qualifier path for a principal residence or second home. The depletion path is the only one that finances an investment property.
- Credit: the qualifier path has a 600 minimum score. The depletion path follows the lender’s matrix.
- One path at a time: a borrower is qualified on one path, never a blend of the two.
When Should an Indiana Buyer Choose the Asset Qualifier Path?
Choose it when three things line up: your eligible assets cover the whole loan, your documented income is light or your monthly debts are heavy, and the home is a principal residence or second home. In that situation the qualifier path removes the income test entirely.
Here is the plain logic. The qualifier path asks one question: do your eligible assets equal or exceed the loan? If yes, the file rests on the assets. Nobody calculates a debt-to-income ratio, because no income is documented. The depletion path asks a harder question. It turns your assets into a monthly income figure and then checks whether that income carries the housing payment and your other debts.
Several situations push a buyer toward the qualifier path:
- Heavy existing debts. Debts matter on the depletion path and do not enter the test on the qualifier path.
- A mid-sized loan against a big balance sheet. If the assets exceed the loan, the qualifier path is the more direct fit.
- Retirement money at 59½ or older. Retirement balances count at 100% on the qualifier path at that age. On the depletion path they count at 70% at any age.
- No income at all. Someone living on a portfolio, with no paycheck and no pension large enough to matter, has nothing for an income test to work with.
The reverse also holds. If the loan is bigger than your assets, the qualifier path cannot work, because it needs the assets to cover the loan in full. That is where depletion earns its place, and the next sections show where the break point sits.
Key Terms Defined
Lenders use these labels loosely, so here is how Lendmire uses them on this page.
Asset qualifier path: a way to qualify on assets alone. Eligible assets, after the credit percentages, must equal or exceed the entire loan, and no employment or income is documented.
Asset depletion path: a way to turn assets into income. Usable assets are divided by 60 months, and the result is monthly qualifying income that runs through the debt-to-income test.
Debt-to-income (DTI) test: a comparison of your monthly debts, including the new housing payment, to your qualifying income.
Seasoning: how long money has sat in an account before the lender will count it.
Haircut: the share of an account’s balance a lender will not count. A 20% haircut on securities means 80% counts.
DSCR loan: a business-purpose investor loan that qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.
How Does Each Path Turn Assets Into a Loan?
Each path counts your balances at different percentages and then applies a different test. Never mix the two sets of percentages. A figure that is right for one path is wrong for the other.
On the asset qualifier path, the share of each balance that counts looks like this:
- Brokerage accounts, certificates of deposit, money market and savings count at 100%.
- 401(k) and IRA balances count at 90% if you are under 59½ and at 100% at 59½ or older.
- Accounts combine, so several accounts can add up to the loan amount.
On the asset depletion path, the haircuts are steeper:
- Cash accounts and certificates of deposit count at 100%.
- Securities count at 80%, and private stock at 75%.
- Retirement accounts count at 70% at any age.
- Real-estate equity counts at 60%.
- 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 are not eligible.
Cryptocurrency, precious metals, collectibles, pledged or borrowed funds and business accounts beyond your ownership share are not published as eligible on either path. The documented route is to convert them to a seasoned cash balance in a regulated account, with the lender reviewing the source.
Tax treatment varies by account type and how funds are used; consult a qualified professional before drawing on retirement money.
Same Assets, Two Paths: A Worked Example
Run one set of balances through both paths and the difference becomes clear. These figures are illustrative, and the lender’s own calculation governs.
Qualifier path. Picture an $800,000 loan. The borrower holds $330,000 in brokerage accounts (100% counts, so $330,000), $300,000 in a 401(k) while under 59½ (90% counts, so $270,000) and $200,000 in savings (100% counts, so $200,000). That adds up to $800,000 of usable assets, which matches the loan. The file is reviewed on assets alone, subject to underwriting.
Same balances on the depletion path. Brokerage holdings count as securities at 80%, which is $264,000. The 401(k) counts at 70%, which is $210,000. Savings stay at $200,000. Usable assets total $674,000. That falls short of the depletion minimum, which is the lesser of $1,000,000 or 1.25 times the loan balance. Dividing $674,000 by 60 months would also produce modest qualifying income against an $800,000 loan. The same borrower passes on one path and does not work on the other.
Now flip it. Say a buyer holds $1,500,000 in securities and $300,000 in cash. On the depletion path, securities count at 80%, which is $1,200,000, and cash counts at 100%, which is $300,000. That is $1,500,000 usable, and dividing by 60 months gives $25,000 of monthly qualifying income. That income must then carry the housing payment and other debts through the debt-to-income test. If the buyer’s debts are light, depletion may work well. If the buyer carries heavy obligations, the qualifier path may fit better, provided the loan is no larger than the assets that count.
The lesson is simple. The qualifier path rewards a balance sheet that is large relative to the loan.
Side-by-Side: Qualifier Path vs. Depletion Path
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| How it qualifies | Assets must cover entire loan | Assets ÷ 60 months = income |
| Income documented | None | Derived income, DTI test |
| Purchase leverage | Up to 80% (primary, second home) | Up to 80% primary/second; 65% investment |
| Cash-out | Set by lender, not published | Up to 60% on all occupancies |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum | Lender’s matrix |
| Seasoning | 60 days, two months of statements | Statements 120+ days old, one within 45 days |
| Investment property | Not offered | Offered |
Two details deserve a closer look. First, the qualifier path’s refinance ceiling is 75% on a principal residence or second home, and the cash-out figure is the lender’s call. Do not plan around a number nobody publishes. Second, on the depletion path cash-out proceeds never count as qualifying assets.
Where Does the Loan Size Break the Tie?
The size of the loan against the size of your assets is often what settles the choice. The qualifier path needs assets equal to the whole loan, so the bar rises dollar for dollar with the loan. The depletion path needs qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance, and never less than $250,000 liquid when depletion is your only income source.
Put those two rules next to each other:
- On a loan of $800,000, the qualifier path wants $800,000 of usable assets. The depletion minimum is $1,000,000.
- On a loan of $2,000,000, the qualifier path wants $2,000,000 of usable assets. The depletion minimum stays at $1,000,000, though you still need enough derived income to pass the debt test.
So a buyer with a balance sheet only slightly above the loan often looks better on the qualifier path. A buyer with a large loan and a smaller portfolio may only be able to use depletion. Neither is better in the abstract. The right path is the one your own numbers clear.
What Does the Stronger Path Cost You?
The qualifier path is not a free upgrade. It asks for more in some areas, and it has tradeoffs the depletion path does not.
- Coverage of the whole loan. Your eligible assets must match the loan before anything else is considered.
- Reserves above 75%. None are required at or below 75% loan-to-value on this path. Above that, the lender sets them, so an 80% purchase may carry a reserve requirement.
- A 600 credit floor. That is the published minimum, and it is still a floor, never a promise. The lender reviews the whole file.
- Seasoning on each account. The qualifier path wants 60 days and two months of statements for every account you count.
Seasoning is where timing can decide the path. Sale-of-business, inheritance and legal-settlement funds are excused from the depletion path’s statement-age rule. Money from a recent business sale may therefore be easier to use on depletion than to season for the qualifier path. Ask the lender how your specific funds are treated before you choose.
The depletion path has its own demands. A first-time investor needs a 700 score, a housing event requires 4 years of seasoning, and one 30-day late payment in the last twelve months is reviewed case by case. Multiple bankruptcies are not eligible on either path.
Neither path means you sell your assets. The balances demonstrate repayment ability, and nothing is liquidated.
A word on the rules behind this. A lender still has to check that you can repay. The CFPB’s General QM final rule says the lender must consider and verify income or assets, and the assets stay documented on both paths. A legal commentary in the Consumer Finance Services Review explains that a non-QM lender may base that determination solely on verified assets. A Thomson Reuters summary of the rule amendments adds that no required underwriting method or DTI threshold is set. That freedom is why the two paths differ from lender to lender, and why the figures on this page describe select programs rather than the whole market.
When Is Neither Path the Right Tool?
If the property is a rental, the right tool is often a DSCR loan rather than either asset path. The depletion path does finance an investment property, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. But those loans carry a personal debt-to-income test, and an investment property that rents well often fits better elsewhere.
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines, and your portfolio shows up as reserves instead of income. Programs below 1.00 coverage are available through select lenders in the network, with loan-to-value and terms adjusting accordingly. The complete DSCR loans guide walks through how that works.
A quick sorting guide:
- Assets cover the loan, income is light, owner-occupied or second home: the asset qualifier path.
- Assets are large but smaller than the loan, or an investment property with thin rent: the asset depletion path.
- A rental that rents well: a DSCR loan.
- Income that shows up in deposits, such as self-employment: the bank statement program, which is built for borrowers who document income with deposits.
What Do Indiana Buyers Typically Look Like?
Indiana buyers on these paths tend to be cash-rich and income-light. Lendmire’s consumer lending is licensed in Indiana, among 16 states, and the program figures on this page do not change by state. State factors such as local prices and taxes are context, never program parameters.
A few common profiles:
- A retiree downsizing from a larger home, with a portfolio and a pension too small to carry a conventional income test. The qualifier path often fits when the new home costs less than the portfolio.
- A business owner who has sold the company and holds proceeds in cash and brokerage accounts. Depletion’s seasoning exception for sale-of-business funds can matter here.
- An heir or settlement recipient with a large balance and no earned income. Both paths may apply, depending on which assets they hold.
- An early-retired professional living off a portfolio and buying a second home in a lake or resort area.
Readiness Checklist
Before you ask for a comparison, gather what each path needs:
1. Two months of statements for every account you plan to count, and 60 days of seasoning for the qualifier path. 2. Older statements, at least 120 days old plus one within 45 days, if you expect to use depletion. 3. A list of accounts by type, because brokerage, retirement, cash and private stock count at different percentages. 4. Your birthday relative to 59½, which changes how retirement balances count on the qualifier path. 5. A plan for any asset the lender does not accept, such as crypto, converted into a seasoned cash balance. 6. Your credit score and any housing history, so you know which path’s credit rules apply.
Money moved between accounts shortly before application can reset seasoning, so avoid large transfers once you start.
Frequently Asked Questions
Are the asset qualifier and asset depletion paths the same thing?
No. Lenders use the labels differently, but on this page they are two separate paths. The qualifier path needs eligible assets to cover the entire loan and documents no income. The depletion path divides usable assets by 60 months to create qualifying income that goes through the debt-to-income test.
Do I have to sell my investments to qualify?
No. The assets show you can repay. Nothing is liquidated. The lender documents the balances with statements and, subject to underwriting, counts the percentages that apply to each account type.
Can I use these paths to buy a rental property?
Only the asset depletion path finances an investment property, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. The qualifier path is for principal residences and second homes. A rental that covers its own payment usually fits a DSCR loan better, which qualifies primarily on rental income, subject to lender guidelines.
Can asset income be combined with other income?
On the depletion path, yes. Asset-derived income may supplement documented income up to a 45% debt-to-income ratio, and when it supplements, the minimum-assets rule is waived. The qualifier path is assets alone. A borrower is qualified on one path at a time.
Does asset-based qualification mean no documentation?
No. The qualifier path documents no income or employment, but the assets are fully documented with statements. Credit is reviewed on both paths, and nothing is approved until underwriting is complete.
Next Steps
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 are placed through select lenders in Lendmire’s network, every file is underwritten individually, and nothing here is a commitment to lend.
About Lendmire
As a mortgage broker (NMLS# 2371349), Lendmire helps self-employed and high-net-worth borrowers in 16 states qualify on bank statements, a profit-and-loss statement, 1099s or liquid assets instead of tax returns, through wholesale lenders. Lendmire is never the lender; program terms are set by the lender and its guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. Consumer Finance Services Review
3. Thomson Reuters CFPB ATR/QM amendments summary
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 Depletion vs DSCR for a Retired Buyer With No Paycheck · How an Asset Depletion Mortgage Works · How to Qualify for an Asset Qualifier Mortgage
Guides: Asset-Based Mortgage in Indiana
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.