The Quick Read: Yes, through select asset-based programs, a Montana buyer can count IRA balances toward a mortgage without taking a single withdrawal, because the lender documents the balance rather than draining it. The retirement account stays invested and is treated as evidence of resources, either covering the loan outright or converting into a qualifying income figure.
- 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, which then runs through the debt-to-income test.
- Retirement balances count at 90% under age 59½ and 100% at 59½ or older on the qualifier path, and at 70% at any age on the depletion path.
- Every file is fully underwritten, and the lender’s own calculation governs, subject to underwriting.
Montana is one of 16 states where Lendmire is licensed for consumer mortgage lending, so a Montana borrower sees the same program figures as anyone else. Nothing about IRA treatment changes at the state line. What changes the answer is your age, your mix of accounts, how much you want to borrow, and whether the home is a primary residence, second home or rental.
Why Can a Lender Count an Account You Aren’t Drawing From?
A lender can count an IRA because the question being asked is not “what do you earn?” It is “can you carry this loan?” A large, seasoned balance answers that question without a paycheck.
Picture a retiree in Bozeman or Missoula with a large IRA, a brokerage account and a modest pension. Her tax return may show little income, since she lives off savings and chooses when to take distributions. A standard income-based mortgage reads that return and sees a weak borrower. An asset-based mortgage reads the statements and sees substantial resources.
The word “depletion” causes most of the confusion. It describes a calculation, not an action. The lender divides your usable assets over a set period to produce a notional monthly income. Nothing leaves the account. You never have to sell a share or request a distribution to make the math work.
This is a consumer mortgage with no traditional personal-income documentation, pay stubs or employment verification on the qualifier path. It is not a no-documentation loan. The assets are documented with statements, the credit is reviewed, and the property is appraised.
What Are the Two Ways IRA Money Counts?
Across the wholesale network, IRA balances count in two different ways, and a borrower is qualified on one path at a time. Never blend the two tables.
| Factor | Asset Qualifier | Asset Depletion |
|---|---|---|
| Core test | Assets cover the entire loan | Assets become monthly income |
| Income documented | None | Derived income only |
| IRA or 401(k) credit | 90% under 59½; 100% at 59½+ | 70% at any age |
| Purchase leverage | Up to 80% | Up to 80% (primary or second home) |
| Refinance leverage | Up to 75% | Up to 80% rate-and-term; 60% cash-out |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit floor | 600 | The lender’s matrix |
All figures are ceilings and floors available through select programs, subject to underwriting, not offers.
On the qualifier path, eligible assets after the credit percentages must equal or exceed the entire loan amount. Consider an $800,000 loan. Say the borrower holds $330,000 in brokerage accounts (counted at 100%), $300,000 in a 401(k) while under 59½ (counted at 90%, or $270,000) and $200,000 in savings (counted at 100%). Usable assets total $800,000, which matches the loan, so the file is reviewed on assets alone. The IRA never moved.
On the depletion path, the math runs differently. Take $1,500,000 in securities (counted at 80%, or $1,200,000) plus $300,000 in cash (counted at 100%). That is $1,500,000 of usable assets. Divided by 60 months, it produces $25,000 of monthly qualifying income, which then has to carry the housing payment and other debts through the debt-to-income test. These examples are illustrative, and the lender’s own calculation governs.
Which Retirement Accounts Count, and What Does the Lender Check?
Traditional IRAs, Roth IRAs, SEP IRAs and 401(k) balances are the retirement accounts that typically carry credit on these programs, provided the borrower owns the account and the balance is documented. Treatment differs by path, so read the percentages against the path you are on.
| Asset type | Qualifier path | Depletion path |
|---|---|---|
| Brokerage | 100% | Securities 80% |
| Cash, savings, money market | 100% | Cash 100% |
| Certificates of deposit | 100% | 100% |
| 401(k) and IRA | 90% under 59½; 100% after | 70% any age |
| Real-estate equity | Not listed | 60% |
Several assets do not count on the depletion path. Custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units are all out, as are funds from non-regulated financial companies.
Cryptocurrency, precious metals and collectibles are not published as eligible on either path. Pledged or borrowed funds are out as well. The documented route for these holdings is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
A word on Roth versus traditional. The program tables above do not draw a separate line for Roth accounts. Lender treatment of ownership, access and account type can still vary by file, so list every account on your first call and let the lender confirm how each one is read.
Does Age Change the Answer?
Age changes the qualifier-path credit on retirement accounts, and that is the main place it matters. Under 59½, a 401(k) or IRA counts at 90%. At 59½ or older, it counts at 100%. The depletion path uses 70% at any age, so age does not move that figure.
The 59½ line comes from tax law. Distributions before that age can trigger additional tax, and lenders reflect that reality by trimming the early balance slightly. For a borrower in their early fifties with most of their wealth in retirement accounts, the 10-point difference is small relative to the benefit of leaving the money untouched.
Required minimum distributions are a separate matter. The IRS says traditional, SEP and SIMPLE IRA owners generally must begin taking RMDs at age 73, even if retired. The Congressional Research Service notes that SECURE 2.0 raises that age to 75 for people who turn 73 after a future threshold date. An RMD is a tax obligation. It does not turn your IRA into qualifying income, and a borrower who is not yet at RMD age is not penalized for it.
What Does Withdrawing Cost Compared With Leaving It Alone?
Leaving the IRA invested avoids taxable income in the year you buy, avoids any early-distribution tax and keeps the account compounding. Withdrawing to “show income” or to pay cash has the opposite effect on all three.
Think of it as two ways to solve the same problem. The first: pull a large sum from a traditional IRA, pay income tax on it, perhaps push yourself into a higher bracket, and then use the cash. The second: document the balance as is and let the lender count it at the program percentage. The second route gives up a small slice of the balance in the lender’s math, not in your pocket.
The tradeoff flips in some cases. If you need cash for a down payment or closing costs and have no other liquid source, a withdrawal may be unavoidable, and you should plan its tax effect with a professional. Tax treatment varies; consult a qualified professional before relying on any deduction or strategy.
Can IRA Assets Fund the Down Payment and Closing Costs?
Counting an IRA toward qualification is different from spending it at closing. Down payment and closing costs need documented, available funds, and the lender reviews the source. If most of your cash is inside a retirement account, a portion may need to come out, or you may rely on other liquid accounts, such as savings, money market or brokerage.
On the qualifier path, the leverage matters here. At up to 80% on a purchase, the buyer still brings the remaining 20% plus costs. Keeping a cash account separate from retirement holdings makes that cleaner. Cash-out proceeds never count as qualifying assets on the depletion path, so you cannot borrow against one property to qualify for another.
Do not make mid-process moves. Rolling an account to a new custodian, transferring between institutions or borrowing against a 401(k) can disrupt seasoning and force the lender to re-review the file.
How Does Seasoning and Documentation Work?
Statements carry the whole file, so gather them early. Programs differ by path.
1. Qualifier path: 60 days of seasoning and two months of statements for each qualifying account.
2. 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.
3. Credit: a 600 minimum on the qualifier path. The depletion path follows the lender’s matrix, and a first-time investor on that path needs 700.
4. Housing history: 0x30x12 is the standard, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible.
Depletion-path minimums are higher. Qualified assets generally must be at least 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. Asset-derived income may also supplement documented income up to a 45% debt-to-income ratio, and in that case the minimum-assets rule is waived.
Across the network, the practical pattern is that files stall on seasoning and on large unexplained deposits, not on the percentage haircuts. A deposit you cannot source in writing is the fastest way to complicate a clean asset file.
Primary Home, Second Home or Rental?
The occupancy decides the path. For a primary residence or second home, both paths apply, and the depletion path reaches up to 80% on a purchase. For an investment property, only the depletion path applies, and leverage drops to 65% on a purchase or rate-and-term refinance and 60% on a cash-out.
That limit points many rental buyers elsewhere. If the property will be a pure rental, financing built on its rent usually fits better, and Lendmire’s asset-based mortgage program is aimed at the cash-heavy, income-light borrower buying a home to live in. For rentals, DSCR lending generally uses the IRA only as proof of reserves, not income. Some investors use both: asset-based financing for a residence, rental financing for the portfolio.
One comparison point is worth stating plainly. Rates are not quoted here, and a borrower should not assume that terms or eligibility seen elsewhere carry over to this program.
Who Should Skip This Route?
Skip it if your documented income already qualifies you comfortably and you want the simplest file. A conventional loan built on W-2s may carry lower friction.
Skip it if your wealth sits mostly in assets the programs do not count, such as crypto, collectibles or a business account you only partly own. Skip it if you cannot season the funds. And skip it if the balances fall below the depletion-path minimums, since the lesser of $1,000,000 or 1.25 times the loan, and never under $250,000 liquid, is a real gate.
If you are close to the line, the answer is usually to adjust the structure, not the loan type. A lower loan amount, a larger down payment or a different mix of accounts can move the numbers. Consider a borrower who falls short on the depletion path but holds enough brokerage and cash on the qualifier path. Switching paths, not stretching the file, may solve it.
Key Terms Defined
Asset qualifier: a path where eligible assets, after credit percentages, must equal or exceed the whole loan.
Asset depletion: a path that divides usable assets by 60 months to create monthly qualifying income.
Haircut: the share of a balance the lender does not count, such as the 30% trimmed from retirement accounts on the depletion path.
Seasoning: the length of time funds must sit in an account before they count.
RMD: a tax-law withdrawal requirement for retirement accounts, not a mortgage feature.
Frequently Asked Questions
Do I have to be retired to use IRA assets this way?
No. Neither path requires retirement. The program is built for borrowers with large balances and light documented income, which includes retirees, business sellers and early-retired professionals. Your balances, seasoning and credit are what the lender reviews, subject to underwriting.
Does my age matter if I’m under 59½?
It matters on the qualifier path, where a 401(k) or IRA counts at 90% under 59½ and 100% after. On the depletion path, retirement accounts count at 70% at any age. Either way, no withdrawal is needed to apply.
Can I combine IRA money with brokerage and savings?
Yes. Accounts combine on the qualifier path, so brokerage, savings, CDs and retirement balances all add toward the loan amount. On the depletion path, each asset class carries its own percentage before the total is divided by 60 months.
Does an RMD count as income for the loan?
No. An RMD is an IRS obligation, and the IRS sets when distributions must begin. It does not create qualifying income. The lender reads your statements, not your distribution schedule.
Is this the same as a no-doc loan?
No. Every file is fully underwritten. You skip traditional personal-income documentation, pay stubs and employment verification on the qualifier path, but the lender documents your assets with statements, reviews credit and appraises the property.
The Practical 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, not a lender, and places these loans through select lenders in its network. Reach the team at 828-256-2183. Program details change, and every figure here is subject to underwriting, not a commitment to lend.
Montana’s relocation and retirement buyers tend to arrive with large portfolios and small paychecks, which is exactly the profile these programs were designed to read.
Lendmire’s asset-based mortgage in Montana page presents the program for Montana borrowers.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges bank statement, P&L-only, 1099-only and asset-based home financing in 16 states through wholesale lenders, on primary residences, second homes and investment properties. Every option is subject to the lender’s guidelines and full underwriting. 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.
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References
1. IRS: Retirement Plan and IRA Required Minimum Distributions FAQs
2. Congressional Research Service: Required Minimum Distributions
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 a Georgia Trust Beneficiary Qualify for a Mortgage on Trust Assets? · Can a Michigan Widow Qualify for a Mortgage on Life Insurance and Retirement Assets? · Reserves vs Qualifying Assets on an Asset Qualifier Mortgage
Guides: Asset-Based Mortgage in Montana
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.