The Quick Read: Usually no: on the asset qualifier path, the loan is qualified on eligible assets that cover the whole amount, and on the asset depletion path it is qualified on income converted from those assets, so in both cases traditional personal-income documentation is generally not the basis for approval. Assets, credit and the property are still documented in full, and every file is underwritten individually. Qualification on either path is subject to underwriting through select programs.
- Qualifier path: eligible assets must equal or exceed the entire loan, and no employment or income is documented.
- Depletion path: usable assets divided by 60 months become qualifying income, which then runs through a debt-to-income test.
- Not no-paperwork: statements, seasoning, credit and the appraisal all stay in the file.
- Same in New Mexico: program figures do not change by state, and consumer lending is licensed in New Mexico.
Who Is This Mortgage Built For?
An asset-based mortgage fits a borrower whose balances are large and whose documented income is small. Think of retirees, people who just sold a business, recipients of an inheritance or settlement, early-retired professionals, and households living off a portfolio.
Conventional underwriting reads traditional personal-income documentation because it wants to see income. For these borrowers, the return often understates their position. Deductions, retirement and one-time sales can push taxable income far below what the household can actually spend.
Asset-based programs flip the question. They ask what the borrower owns, how much of it counts, and whether it has been in the account long enough. Traditional income documentation stops being the centerpiece.
This article covers consumer mortgages on a principal residence or second home, plus investment property on one path only. Rental investors who qualify on property rent should read Lendmire’s complete DSCR loans guide, because that is a different product with a different file.
Why Don’t These Files Need Tax Returns?
Because the loan is qualified on something else. Traditional income documentation is a way to prove income. When the loan rests on assets, or on income computed from assets, the return has no job to do.
On the qualifier path, the lender checks one thing: do eligible assets, after the credit percentages, equal or exceed the entire loan amount? If yes, no employment or income is documented. The lender’s ability-to-repay review rests on those assets.
On the depletion path, the lender builds an income figure from assets. It adds up usable assets after haircuts and divides by 60 months. That number must carry the full housing payment and other debts through the debt-to-income test.
A borrower is qualified on one path at a time. The two tables never blend.
Two Paths, Side by Side
| Factor | Asset Qualifier | Asset Depletion |
|---|---|---|
| Core test | Assets cover whole loan | Assets ÷ 60 = income |
| Income documented | None | Derived from assets |
| Debt-to-income test | Not applied | Applied |
| Property types | Primary, second home | Primary, second, investment |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit floor | 600 | Lender’s matrix |
Both paths are subject to underwriting, and the figures are ceilings and floors, never offers.
What Do You Provide Instead of Tax Returns?
You provide proof of the assets themselves. This is where borrowers get surprised.
Expect the file to include:
- Account statements: two months for each qualifying account on the qualifier path.
- Statements on the depletion path: statements at least 120 days old at application, plus the most recent one within 45 days.
- Credit report and ID: the lender pulls credit, and every borrower is identified.
- Purchase contract or current mortgage statement: depending on whether you are buying or refinancing.
- Appraisal and insurance: the property is valued and insured like any consumer mortgage.
- Source of funds: large or recent movements are reviewed.
Because this is a consumer mortgage, standard consumer disclosures apply. A business-purpose investor loan works differently, and that distinction matters later.
Conventional personal-income paperwork can still enter a file in one case. On the depletion path, asset income can supplement documented income up to a 45% debt-to-income ratio. When you add employment or business income to the picture, the lender reviews the documents that support it, and those may include returns.
Which Assets Count on the Qualifier Path?
On the qualifier path, most liquid balances count at face value. Retirement accounts count fully only after age 59½. Accounts combine, so several smaller balances can add up to one qualifying total.
| Asset (qualifier path) | Share that counts |
|---|---|
| Brokerage accounts | 100% |
| Certificates of deposit | 100% |
| Money market | 100% |
| Savings | 100% |
| 401(k) and IRA, under 59½ | 90% |
| 401(k) and IRA, 59½ or older | 100% |
Seasoning on this path is 60 days. The credit minimum is 600. Leverage reaches up to 80% loan-to-value on a purchase and 75% on a refinance, on a principal residence or second home.
Here is an illustration only, since the lender’s own calculation governs. Take 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 is $800,000 of usable assets, which covers the loan on assets alone.
No reserves are required at or below 75% loan-to-value on this path. Above that, the lender sets them.
Whether cash-out proceeds are allowed on the qualifier path is set by the lender and is not published, so plan on a purchase or a refinance without cash out.
Which Assets Count on the Depletion Path?
The depletion path is stricter. Most assets are haircut, and the haircut shrinks the income you can claim. A portfolio heavy in stocks produces less qualifying income than the same balance held in cash.
| Asset (depletion path) | Share that counts |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts (any age) | 70% |
| Real-estate equity | 60% |
Several assets are not eligible on this path. These include 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.
Here is the illustrative shape. A borrower holds $1,500,000 in securities (80% counts, so $1,200,000) and $300,000 in cash (100% counts, so $300,000). That is $1,500,000 of usable assets. Divided by 60 months, it produces $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test. The lender’s calculation governs.
Minimums apply here as well. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. They can never be below $250,000 liquid when asset depletion is the only income source. When asset income only supplements documented income, the minimum-assets rule is waived.
What About Crypto, Metals and Other Holdings?
Cryptocurrency, precious metals, collectibles, business accounts beyond your ownership share, and pledged or borrowed funds are not published as eligible on either path. They do not count at a percentage.
The documented route is conversion. You sell the asset, move the proceeds into a regulated account, season the balance, and let the lender review the source. Cash-out proceeds from the loan itself never count as qualifying assets on the depletion path.
How Much Can You Borrow Against the Property?
Leverage depends on the path, the transaction and the occupancy. Read each line with all three.
| Path and occupancy | Purchase / rate-and-term | Cash-out |
|---|---|---|
| Depletion, primary or second home | Up to 80% | Up to 60% |
| Depletion, investment property | Up to 65% | Up to 60% |
| Qualifier, primary or second home | Up to 80% (purchase) | Not published |
On the qualifier path, a refinance of a principal residence or second home goes up to 75%. These ceilings apply through select programs and subject to underwriting.
A first-time investor on the depletion path needs a 700 credit score. Housing history is 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. A housing event needs 4 years of seasoning on the depletion path. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
Asset-Based vs DSCR vs Bank Statement vs Conventional
These products get blurred in search results, and the blur causes bad decisions. Each one answers a different question about the borrower.
| Product | What it is reviewed on | Best for |
|---|---|---|
| Asset-based | Eligible assets | Cash-rich, income-light buyers |
| DSCR | Property rent vs. full payment | Rental investors |
| Bank statement | Deposits as income | Self-employed with strong deposits |
| Conventional | standard personal-income documentation and W-2s | Steady documented earners |
A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. It is designed for non-owner-occupied investment properties. Because it is a business-purpose investor loan, it is reviewed differently from a standard owner-occupied mortgage. The business-purpose exemption in federal lending rules is the reason a DSCR file can skip personal income paperwork. The text of 12 CFR 1026.3 at Cornell Law School’s Legal Information Institute shows the same exemption.
An asset-based mortgage does not get that treatment. It is a consumer loan on a home you live in or use as a second home, so ability-to-repay review still applies. That is why assets are tested, not ignored. Owning a rental does not change this. If your goal is buying the next rental, DSCR is usually the cleaner path, and if you own a primary home and are income-light, the asset-based path is the fit.
Do Self-Employed Borrowers Need Returns Here?
Not on the asset paths, as long as the assets carry the loan. A self-employed borrower with large balances and heavily deducted income is a natural candidate. The depletion path in particular suits an owner who sold a business, since sale-of-business funds are excused from the statement-age seasoning.
If you would rather qualify on business deposits, that is a different product. Lendmire’s piece How Many Years of Tax Returns Does a Self-Employed Mortgage Need? covers where returns do come back into play. Inheritance and legal-settlement funds are excused from the same seasoning rule on the depletion path.
Where Does New Mexico Change Anything?
It does not change the program parameters. The leverage, asset percentages, seasoning and minimums above are the same for a New Mexico borrower as for anyone else. New Mexico is one of the 16 states where Lendmire’s consumer mortgage lending is licensed, so the borrower can be served directly in this state.
State-level facts such as local prices, taxes and insurance affect the budget, but they are context and never program rules. The first question for a New Mexico buyer is the same as anywhere: does the borrower’s strength sit in assets or in income?
What Are the Trade-Offs?
The cost of this route is that you tie up or discount the assets that qualify you. A depletion-path borrower with a large securities portfolio loses 20% of its value in the calculation and 30% of any retirement balance. A qualifier-path borrower has to hold balances steady through the seasoning window.
The path also demands scale. The depletion path needs at least the lesser of $1,000,000 or 1.25 times the loan, and never less than $250,000 liquid when assets are the sole source. A borrower with modest savings and strong paychecks is usually better served by a conventional file.
Conversely, a borrower with thin documented income and a large portfolio often finds conventional underwriting rejects a file that the asset path handles cleanly. Tax treatment varies; consult a qualified professional.
Step by Step: How a File Is Built
1. Pick the path. Decide whether assets cover the loan outright or whether assets become income.
2. Inventory the assets. List each account, its type, and how long the funds have been there.
3. Apply the percentages. Run the qualifier or depletion table to see usable assets.
4. Check seasoning and statement age. Confirm the 60-day and 120-day windows are met.
5. Check credit and housing history. Compare your score to the program floor or the lender’s matrix.
6. Choose leverage. Match your transaction and occupancy to the ceilings above.
7. Submit to the lender’s review. Lendmire arranges the file through select lenders in its network, and the lender underwrites and decides.
Key Terms Defined
Asset qualifier path: the route where eligible assets, after credit percentages, must equal or exceed the entire loan, with no income documented.
Asset depletion path: the route where usable assets divided by 60 months become qualifying monthly income.
Haircut: the share of an asset’s balance that does not count toward qualifying.
Seasoning: the length of time funds must sit in an account before they count.
Debt-to-income ratio: monthly debts, including the new housing payment, divided by monthly qualifying income.
Loan-to-value: the loan amount as a percentage of the property’s value.
Frequently Asked Questions
Do I need W-2s or pay stubs for an asset-based mortgage?
On the qualifier path, no employment or income is documented. On the depletion path, income is derived from assets, so pay stubs are not the basis either. If you supplement with documented income, expect the lender to review the paperwork that supports it, subject to underwriting.
Can I use my 401(k) or IRA?
Yes, with different credit by path. On the qualifier path, balances count at 90% under age 59½ and 100% at 59½ or older. On the depletion path, retirement accounts count at 70% at any age. Statements are required for each account.
Can I buy an investment property with an asset-based mortgage?
Only on the depletion path, up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out, with a 700 score for a first-time investor. If the goal is a rental that pays for itself, a DSCR loan that is reviewed on property rent is often the better fit.
Does no conventional income documentation mean no documentation?
No. Assets are documented on both paths, along with credit, the property and the source of funds. The only thing set aside is income documentation, and only on the qualifier path is income not evaluated at all.
Is there a different rule for New Mexico borrowers?
The program parameters do not change by state. Lendmire’s consumer lending is licensed in New Mexico, and each file is underwritten individually, with terms that may change.
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. Reach the team at 828-256-2183 or request a quote.
Lendmire’s asset-based mortgage in New Mexico page presents the program for New Mexico 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.
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. CFPB – 12 CFR 1026.3 Exempt transactions
2. Cornell LII – 12 CFR 1026.3
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 a Home After Selling Your Company Without Tax Returns · How to Document a New Mexico Asset Qualifier Mortgage Without an Employer · Can a Business Owner Use Company Cash to Qualify for an Asset-Based Mortgage?
Guides: Asset-Based Mortgage in New Mexico
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
Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.