The Quick Read: The size of the loan, the borrower’s other debts, the type of property and the makeup of the asset pool decide the path. When eligible assets can equal the entire loan, the asset qualifier path usually fits. When assets must work as a source of income, or the property is an investment, asset depletion is the path that applies. The figures below are program ceilings and floors through select programs, subject to underwriting, and they are the same for an Ohio borrower as for anyone else.
- The asset qualifier path counts eligible assets against the whole loan and documents no employment or income.
- The asset depletion path divides usable assets by 60 months to create qualifying income, then runs that income through the debt-to-income test.
- A borrower is qualified on one path at a time, never a blend of the two.
- Investment property is available only on the depletion path, at lower leverage.
- Both paths document the assets in full. No income documentation never means no documentation.
Why Two Paths Exist
A lender wants to know one thing: can this borrower repay the loan? Income is the usual answer. Assets give a second answer when income is thin or hard to document.
Assets can answer the question in two ways. The first says the borrower’s balances are large enough to cover the loan outright, so repayment is not in doubt. The second says the balances can be converted on paper into a steady monthly income and tested like a paycheck.
Those two ideas became the two paths. The asset qualifier path is the cover-the-loan test. The asset depletion path is the income-conversion test. Neither requires you to sell anything. The assets stay invested, and the lender simply counts them.
The reader this fits is cash-heavy and income-light. Think of a retiree living on a portfolio, an Ohio business owner who just sold the company, someone who received an inheritance or settlement, or a professional who retired early. The balances are large, and the documented income is small or gone.
Key Terms Defined
Asset qualifier path: A test in which eligible assets, after the credit percentages, must equal or exceed the entire loan amount, with no income documented.
Asset depletion path: A test that converts usable assets into monthly qualifying income by dividing by 60 months, then runs that income through the debt-to-income test.
Debt-to-income (DTI): The share of monthly income that goes to housing and other debt payments.
Haircut: The percentage of an account’s balance that does not count, because the lender discounts riskier or less accessible assets.
Seasoning: The period an asset must have sat in the account, shown by statements, before it counts.
Usable assets: The balance left after each account is cut by its haircut or credit percentage.
How the Two Paths Compare
The table shows the structural differences. Figures are ceilings that apply through select programs and are subject to underwriting.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| What it tests | Assets cover the entire loan | Assets become monthly income |
| Income documented | None | Derived income, run through DTI |
| Property types | Principal residence, second home | Also investment property |
| Purchase leverage | Up to 80% | Up to 80% (residence); 65% (investment) |
| Refinance leverage | Up to 75% | 80% rate-and-term, 60% cash-out; investment 65% and 60% |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
Two cautions apply. First, a file never uses one column for leverage and the other for assets. Second, on the qualifier path, whether cash-out proceeds are allowed is set by the lender and is not published, so plan the file without them.
How a Lender Picks: The Decision Sequence
In practice, the lender does not choose by taste. The file’s facts push it toward one path. Across a wholesale network, the broker usually models the file on each path and presents the stronger one. Here is the sequence the facts follow.
1. Check the property type. An investment property can only go on the depletion path. A principal residence or second home can go on either.
2. Add up the usable assets. Apply each account’s percentage for the path you are testing. The two paths count the same account differently, so run the sums separately.
3. Compare usable assets to the loan. On the qualifier path, usable assets must equal or exceed the entire loan. If they do, the loan can qualify on assets alone, subject to underwriting.
4. If assets fall short of the loan, test the depletion path. Divide usable assets by 60 months and see whether the resulting income carries the full housing payment and other debts.
5. Look at the existing debts. Heavy car loans, other mortgages or support payments strain the depletion path’s DTI test. They do not enter the qualifier path, which documents no income.
6. Check the leverage. A buyer who wants 80% financing on a purchase has room on both paths for a residence. A borrower who needs more cash from a refinance faces tighter limits on the depletion path.
7. Check credit and seasoning. Both paths document the assets. The credit tests differ, as covered below.
The sequence is the decision. When one step fails, the deal works to the other path or gets restructured.
What Counts, and How Much
The credit percentages differ by path, and mixing them is a common mistake on these files.
On the asset qualifier path, brokerage accounts, certificates of deposit, money market and savings count at 100%. A 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older. Accounts combine.
On the asset depletion path, cash accounts and certificates of deposit count at 100%. Securities count at 80%, private stock at 75%, and retirement accounts at 70% at any age. Real-estate equity counts at 60%.
Retirement money shows the gap well. A 401(k) at age 55 counts at 90% on the qualifier path and 70% on the depletion path. The same balance is worth far more when the goal is to cover the loan outright.
Several asset types are not eligible on the depletion path at all: 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. If your balances sit in one of those, plan to move them into a seasoned cash balance first.
Cryptocurrency, precious metals, collectibles, business accounts beyond your ownership share, and pledged or borrowed funds are not published as eligible on either path. The documented route is to convert them into a seasoned cash balance in a regulated account, with the lender reviewing the source. Cash-out proceeds from the loan itself never count as qualifying assets.
Worked Ohio Scenarios
The arithmetic below is illustrative. The lender’s own calculation governs, and every file is underwritten individually.
A retired business owner who wants the loan covered by assets
Picture an Ohio owner who sold a company and wants to buy a second home on the asset qualifier path. The loan is $800,000. The owner holds $330,000 in brokerage accounts, which count at 100%, so $330,000. A 401(k) of $300,000 sits with the owner under age 59½, so it counts at 90%, or $270,000. Savings of $200,000 count at 100%, or $200,000.
Total usable assets are $800,000, which matches the loan, so the file is reviewed on assets alone. No income is documented. At 75% loan-to-value or below, no reserves are required, and above that the lender sets them. The accounts need 60 days of seasoning and two months of statements each.
A portfolio holder with an income gap who wants assets to become income
Now take a household living on investments, buying a principal residence on the depletion path. The household holds $1,500,000 in securities, which counts at 80%, or $1,200,000. It also holds $300,000 in cash at 100%. Usable assets come to $1,500,000.
Divide by 60 months and the result is $25,000 of monthly qualifying income. That income must then carry the housing payment and other debts through the DTI test. The qualified-asset minimum is the lesser of $1,000,000 or 1.25 times the loan balance, and it never falls below $250,000 in liquid assets when depletion is the only income source.
If a borrower also has documented income, asset-derived income can supplement it up to a 45% DTI. When it supplements, the minimum-assets rule is waived.
An investor buying a rental
Say the borrower wants to buy a rental on assets rather than rent. Only the depletion path applies, and leverage drops to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. A first-time investor on this path needs a 700 credit score. A rental bought on the strength of its rent is usually a different product, covered in Lendmire’s complete DSCR loans guide.
Where the General Rule Breaks
The two names do not mean the same thing everywhere. Some lenders run identical math under both names. Others run DTI on one and not the other. In the programs Lendmire places files with, the two names mean two different tests. When you compare quotes, ask what each product actually calculates.
Seasoning rules differ by path. The qualifier path wants 60 days of seasoning with two months of statements per account. The depletion path wants statements at least 120 days old at application, plus the latest statement within 45 days. Funds from the sale of a business, an inheritance or a legal settlement are excused from that depletion seasoning, which helps the sellers and heirs this product serves.
Credit works differently. The qualifier path has a published 600 minimum. Housing history is expected at 0x30x12, though one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible, and a housing event needs 4 years of seasoning on the depletion path.
Neither path is a no-document loan. Both document the assets. What goes away is employment and income paperwork, and only on the qualifier path.
Agency rules are far narrower. Fannie Mae’s Selling Guide allows only employment-related assets as qualifying income, limits that to principal residences and second homes, and subtracts any distribution penalty. That treatment does not describe these programs and does not apply to investor files.
Rules for the loan itself differ for homes and rentals. The asset programs here are consumer mortgages. Federal ability-to-repay rules allow a lender to rest repayment ability on assets other than the home’s value, per the CFPB’s Regulation Z section on the rule. Loans made primarily for a business or investment purpose fall outside that rule, which is why rental financing is a separate product.
What Goes Wrong, and How a File Gets Re-Routed
Most stalled files fail for ordinary reasons. The usual ones are below.
- The file was run on the wrong path. A borrower with modest debts and large balances gets pushed into income conversion when assets could simply cover the loan. Re-running it on the qualifier path can fix this, if the property is a residence.
- Debt strains the depletion test. If DTI is the problem, paying down a debt or lowering the loan can help. Another option is to move to the qualifier path when the property type allows.
- Large deposits lack a source. Unexplained deposits get reviewed. Gather the paper trail before applying.
- The asset mix is wrong. A pool made up of crypto, business accounts or pledged funds does not count as it stands. Moving it into a seasoned cash balance in a regulated account is the documented route.
- The investor wants more leverage than the path allows. The depletion path’s 65% and 60% investment limits do not move. A lower loan amount or more cash down fits the file to the limits.
The Ohio Angle
The program figures do not change by state. Lendmire’s consumer mortgage business is licensed in 16 states, Ohio among them, so an Ohio borrower can work with the brokerage directly. State-level facts such as local prices, taxes and insurance are file context, not program parameters.
The Ohio files that suit these paths look like the profiles above. Business owners selling out, retirees trading a larger home for a smaller one, and households with portfolio balances but little paycheck income are typical. Each of them can document a lot of assets and little income.
Frequently Asked Questions
Are asset qualifier and asset depletion the same loan?
Not in the programs Lendmire places files with. The asset qualifier path tests whether eligible assets cover the entire loan, with no income documented. The asset depletion path converts usable assets into income over 60 months and runs a DTI test. Lenders may use the names differently, so ask what a quote actually calculates.
Which path gives a borrower more buying power?
It depends on the file. The qualifier path counts retirement accounts at up to 100% and needs no income, but usable assets must reach the full loan amount. The depletion path can review a loan larger than your assets only if the derived income carries the payment, and it counts assets at lower percentages. Modeling both is the only reliable way to know.
Do I have to sell my investments to use either path?
No. The lender counts the assets on paper, and they stay invested. Eligible balances still need seasoning and statements, and the lender may require that large deposits be sourced.
Can I add pension or Social Security income on top of assets?
On the depletion path, asset-derived income can supplement documented income up to a 45% DTI, and the minimum-assets rule is waived when it supplements. The qualifier path documents no income at all. How other income is treated beyond that depends on the specific program, subject to underwriting.
Can I buy a rental property using assets?
Yes, but only on the asset depletion path, with leverage up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. Loans qualified mainly on a rental’s income are a separate DSCR product. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
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 is a mortgage broker that arranges these loans through select lenders in its network, and every program is subject to underwriting and is not a commitment to lend.
Lendmire’s asset-based mortgage in Ohio page presents the program for Ohio borrowers.
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 traditional personal-income documentation, 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
1. Fannie Mae Selling Guide B3-3.4-06, Employment-Related Assets as Qualifying Income
2. CFPB Regulation Z § 1026.43, Minimum Standards for Transactions Secured by a Dwelling
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 Qualifier Mortgage With a Co-Signer? · How to Buy Before You Sell in Alabama Using an Asset Qualifier Mortgage · How to Buy Before You Sell in Ohio Using an Asset Qualifier Mortgage
Guides: Asset-Based Mortgage in Ohio
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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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.