The Quick Read: On an asset qualifier loan, the lender counts each eligible account at a set percentage, adds the results together, and checks that the total equals or exceeds the entire loan amount. Brokerage, certificates of deposit, money market and savings count at 100%, while 401(k) and IRA balances count at 90% under age 59½ and 100% after.
- The asset qualifier path covers the whole loan with assets and documents no employment or income.
- The asset depletion path is different: usable assets divided by 60 months become a qualifying income.
- Accounts combine, so a mixed portfolio is added into one pool.
- Seasoning on the qualifier path is 60 days, with two months of statements per account.
- All figures are ceilings and floors through select programs, subject to underwriting.
Picture a household with big balances and a thin paycheck: a retiree, someone who just sold a business, or an early-retired professional living off a portfolio. Traditional personal-income documentation and pay stubs undersell that household. Asset-based financing exists for it.
One scope note first. This loan is a consumer mortgage for principal residences and second homes on the qualifier path. Lendmire arranges it through select lenders in its wholesale network, through its asset-based mortgage programs. Rental-property financing reviewed on the property’s rent is a different product, and it is not the subject here.
What Is an Asset Qualifier Loan?
An asset qualifier loan is reviewed on wealth instead of income. Eligible assets, after the percentages below, must equal or exceed the entire loan amount. No employment or income is documented, and no traditional personal-income documentation, pay stubs or employment verification are requested.
Note what stays documented: the assets. Every account is verified with statements, and every file is fully underwritten.
Lenders use different names for similar ideas: asset qualifier, asset depletion, asset utilization. In Lendmire’s network the two paths are distinct, and a borrower is reviewed on one path at a time.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| Core test | Assets cover the whole loan | Assets become monthly income |
| Income documented | None | Derived from assets |
| Divisor | None | 60 months |
| Debt-to-income test | Not applied to income | Applied to derived income |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
How Does Underwriting Add Up the Accounts, Step by Step?
Underwriting works through a fixed sequence: inventory the accounts, apply each account’s percentage, total the results, and compare the total to the loan amount. Order matters because every dollar can do only one job.
1. Inventory and document. Each qualifying account needs two months of statements showing owner, account type and balance.
2. Classify. Accounts fall into cash and cash-like deposits, brokerage holdings, and retirement accounts.
3. Apply the credit percentage. This is the haircut. Each class counts at its own share of the balance.
4. Combine. Accounts add together into one pool.
5. Compare. On the qualifier path, the pool must equal or exceed the loan.
The ordering exists because the same funds cannot qualify the file and also pay for the closing. Cash-out proceeds never count as qualifying assets on the depletion path either.
How Is Each Account Type Counted?
Each class counts at its own share, and the two paths use different tables. Never blend them.
Asset qualifier path (share of balance that counts):
| Account | Credit |
|---|---|
| Brokerage | 100% |
| Certificates of deposit | 100% |
| Money market | 100% |
| Savings | 100% |
| 401(k) or IRA, under 59½ | 90% |
| 401(k) or IRA, 59½ or older | 100% |
Asset depletion path (share of balance that counts):
| Account | Credit |
|---|---|
| Cash and CDs | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
The same brokerage dollar is worth 100% on one path and 80% on the other. That gap is why the first decision is the path, not the account list. Across the wholesale network, borrowers with enough assets to cover the whole loan usually prefer the qualifier path, since it skips the income conversion. Borrowers whose assets fall short of the loan look at depletion.
Why Do Retirement Accounts Get Discounted?
Retirement balances are discounted because reaching them can be costly. The IRS says early distributions from traditional and Roth IRAs before age 59½ generally carry a 10% additional tax on top of regular income tax on the taxable part. Exceptions exist, but a lender cannot assume one applies.
So the qualifier path counts these accounts at 90% under 59½ and 100% at 59½ or older. The haircut is a blunt approximation of that access cost, not a computed tax bill. The depletion path is stricter and counts retirement accounts at 70% at any age.
Do retirement accounts count? Yes, on both paths. They count at a discount, and the balance has to be vested and documented. The IRS 401(k) guide says the same early-distribution rule reaches plan distributions before 59½.
Worked Examples
These examples use the program’s own percentages and are illustrative. The lender’s calculation governs, and every file is underwritten individually.
Qualifier path. An $800,000 loan. The borrower holds $330,000 in brokerage accounts, $300,000 in a 401(k) and is under 59½, and $200,000 in savings.
| Step | Balance | Credit | Counts |
|---|---|---|---|
| Brokerage | $330,000 | 100% | $330,000 |
| 401(k), under 59½ | $300,000 | 90% | $270,000 |
| Savings | $200,000 | 100% | $200,000 |
| Total usable | $800,000 |
Usable assets of $800,000 match the $800,000 loan, so the file is reviewed on assets alone, subject to underwriting. Not a dollar of slack. A market drop in the brokerage account would put the file short, which is why the statement date matters.
Depletion path. The borrower holds $1,500,000 in securities and $300,000 in cash.
| Step | Balance | Credit | Counts |
|---|---|---|---|
| Securities | $1,500,000 | 80% | $1,200,000 |
| Cash | $300,000 | 100% | $300,000 |
| Total usable | $1,500,000 |
Divided by 60 months, that is $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test. Here the conversion is what matters, not the total alone.
What Doesn’t Count?
Plenty of wealth sits outside the table. The depletion path excludes 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.
Cryptocurrency, precious metals, collectibles, and business accounts beyond the borrower’s ownership share are not published as eligible on either path. Pledged or borrowed funds do not count. The documented route is converting these holdings to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
One more edge case: down payment funds. They come out of the pool before the math, so the same money cannot qualify the file and also fund the purchase.
Seasoning, Statements and Credit
Seasoning means the money has sat in the account long enough to be considered the borrower’s own. The paper trail differs by path.
- Qualifier path: 60 days of seasoning and two months of statements for each qualifying account. Credit score floor of 600.
- Depletion path: statements at least 120 days old at application, plus the most recent statement within 45 days. Sale-of-business, inheritance and legal-settlement funds are excused from that seasoning. Credit follows the lender’s matrix. A first-time investor on this path needs 700.
Housing history of 0x30x12 is the standard, and one 30-day late in the last twelve months is considered case by case. A housing event needs 4 years of seasoning on the depletion path. Multiple bankruptcies are not eligible.
How Much Can You Borrow?
Leverage follows the path and the occupancy. On the qualifier path, a principal residence or second home can reach 80% loan-to-value on a purchase and 75% on a refinance, with loans up to $4,000,000. Whether cash-out proceeds are allowed on this path is set by the lender and is not published.
On the depletion path, a principal residence or second home goes up to 80% on a purchase or rate-and-term refinance and 60% on a cash-out refinance. An investment property on that path tops out at 65% on a purchase or rate-and-term refinance and 60% on a cash-out. Loan amounts run $125,000 to $3,500,000.
The depletion path also has minimum assets: the lesser of $1,000,000 or 1.25 times the loan balance, and never below $250,000 liquid when asset depletion is the only income source. Derived income may instead supplement documented income up to a 45% debt-to-income ratio, and the minimum-assets rule is waived then. On the qualifier path, no reserves are required at or below 75% loan-to-value, and above that the lender sets them.
Where the General Rule Breaks
Several situations bend the tidy table.
- The same portfolio, two answers. A borrower with mostly brokerage and retirement balances will see a larger usable pool on the qualifier path than on depletion, since 100% and 90% beat 80% and 70%. But the qualifier path needs the pool to equal the whole loan.
- Vesting. Non-vested restricted stock units and stock options are excluded on the depletion path. Selling vested holdings and holding the proceeds in a regulated cash account can turn an ineligible position into a seasoned one, though the sale has its own consequences to weigh.
- Market movement. Brokerage balances move. A file that clears by a thin margin on the statement date can fall short on a later one.
- Pledging retirement accounts. The IRS says in Publication 590-B that pledging an IRA as loan security is treated as a distribution. Don’t pledge the account.
- Income-heavy borrowers. Someone with strong documented income may do better on a conventional mortgage. Asset-based loans can carry different pricing, so they make most sense when income documents understate the borrower’s real capacity.
Tax treatment varies by borrower and by how assets are held or sold; consult a qualified professional before relying on any tax outcome.
What Does the Decision Look Like in Practice?
Start with the question of which path fits. If eligible assets, after the credit percentages, can cover the full loan, the qualifier path is cleaner. If they cannot, depletion converts the same assets to income, with a different test and lower credit on several account types.
Then gather the paper: two months of statements per account, ownership documents, and a clear source for any large deposit. Run the percentages yourself before applying. If the total lands within a few percent of the loan, expect the lender’s calculation to be the deciding one.
Last, think about what the assets are for. Qualifying on assets does not drain the accounts. The 60-month divisor is an underwriting convention, and the money stays where it is. Still, a borrower who keeps almost nothing liquid after the purchase should weigh that on their own terms.
Key Terms Defined
- Asset qualifier: a path that counts eligible assets against the entire loan amount and documents no income.
- Asset depletion: a path that divides usable assets by 60 months to create a qualifying income.
- Haircut: the share of an account’s balance a lender does not count.
- Seasoning: the time funds have been in an account before they count.
- Usable assets: the pool left after each account’s credit percentage is applied.
- Vested balance: the part of a retirement account you own outright.
Frequently Asked Questions
Do I have to sell my investments to qualify?
No. The accounts stay where they are, and the lender verifies them with statements. The divisor on the depletion path is only an underwriting convention. Selling can still make sense when a holding is otherwise ineligible, such as vested stock that must first become a seasoned cash balance.
Can the same money cover the down payment and count as qualifying assets?
Generally no. Down payment and closing funds come out of the pool before the math. Cash-out proceeds never count as qualifying assets either. Plan the pool so the leftover balance, not the starting balance, clears the test.
Do Roth and traditional accounts count the same way?
On the qualifier path, 401(k) and IRA balances share the same credit: 90% under 59½ and 100% at 59½ or older. The depletion path counts retirement accounts at 70% at any age. Underwriting reviews the specific account type and vesting.
Does this program work for investment properties?
Only on the asset depletion path, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. The qualifier path covers principal residences and second homes. Rental financing that is reviewed on rent is a separate loan.
Is this available everywhere?
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. Availability depends on the state, the lender and underwriting.
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, and qualification is subject to underwriting. This is not a commitment to lend.
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.
Investors who want the broader program framework can review how DSCR loans work.
Get Started
Ready to find the right loan for you?
In about 30 seconds you can review financing options available for your home or investment property. No commitment required.
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. IRS Topic 557, Additional Tax on Early Distributions
2. IRS 401(k) Resource Guide, General Distribution Rules
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 Buy Before You Sell in Indiana Using an Asset Qualifier Mortgage · How Much of a Brokerage Account Counts Toward a Washington Asset Qualifier Mortgage? · Can You Get an Asset Depletion Loan While Paying Alimony?
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.