The Quick Read: Yes, an Ohio buyer can count IRA balances toward a mortgage without taking a withdrawal, but only as documented evidence of ability to pay, never as collateral. Through select asset-based programs, the lender counts a share of the vested balance either toward the full loan amount or as a monthly qualifying income, subject to underwriting. The IRA stays invested and untouched.
- On the asset qualifier path, IRA and 401(k) balances count at 90% under age 59½ and 100% at 59½ or older.
- On the asset depletion path, retirement accounts count at 70% at any age, then are divided by 60 months to create income.
- Pledging the IRA as security is treated by the IRS as a distribution, which is the mistake to avoid.
- There are no traditional personal-income documentation, pay stubs or employment verification, but every file is fully underwritten and the assets are documented with statements.
What “Qualifying on an IRA” Actually Means
Qualifying on an IRA means the lender counts the balance as proof you can pay the loan. It does not mean you draw the money. Across the wholesale network, this is done through asset-based mortgage programs, which come in two forms. The borrower sits on one path at a time.
The first is the asset qualifier path. Eligible assets, after the credit percentages, must equal or exceed the entire loan amount. No employment or income is documented. The second is the asset depletion path. Eligible assets, after haircuts, are divided by 60 months to produce a monthly qualifying income. That income must carry the housing payment and other debts through the debt-to-income test.
In neither case does the IRA go on the loan as security. The loan is secured by the home. The IRA is evidence.
Key Terms Defined
Asset qualifier path: qualifying on assets alone, where usable assets must cover the whole loan.
Asset depletion path: converting usable assets into monthly income by dividing by 60 months.
Haircut: the percentage of a balance the lender will not count, which reflects taxes and penalties on liquidation.
Seasoning: the time funds have sat in the account, shown by dated statements.
Vested: the balance belongs to you outright and is not subject to forfeiture.
Pledge: offering an asset as security for a loan, which is the thing an IRA owner must not do.
Path One: Assets Cover the Loan Outright
If your IRA plus other accounts add up to the full loan amount, this path is the cleanest fit. It suits retirees, business sellers, and households living on a portfolio.
Through select programs, leverage runs up to 80% on a purchase and 75% on a refinance, on a principal residence or second home. Loans run up to $4,000,000, subject to underwriting. The credit floor is 600.
The credit percentages are the heart of it:
| Asset | Share counted (qualifier path) |
|---|---|
| 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% |
Accounts combine. Here is an illustration, and the lender’s own calculation governs. Say the loan is $800,000. You hold $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 (100%). That totals $800,000 of usable assets, which covers the loan and is reviewed on assets alone.
Seasoning is 60 days, with two months of statements for each qualifying account. Reserves are not required at or below 75% loan-to-value. Above that, the lender sets them. Whether cash-out proceeds are allowed on this path is set by the lender and is not published.
Path Two: Assets Become Income
If your balances are large but do not cover the whole loan, the depletion path turns them into income. Usable assets are divided by 60 months. That monthly figure then runs through the debt-to-income test with the housing payment and other debts.
The haircuts are steeper here:
| Asset | Share counted (depletion path) |
|---|---|
| Cash accounts and CDs | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
An illustration, again governed by the lender’s own math: $1,500,000 in securities counts at 80%, or $1,200,000. Add $300,000 in cash at 100%. Usable assets total $1,500,000. Divided by 60 months, that is $25,000 of monthly qualifying income.
Leverage on a principal residence or second home runs up to 80% on a purchase or rate-and-term refinance and 60% on a cash-out refinance. Investment property is business-purpose on this path and runs up to 65% on a purchase or rate-and-term refinance and 60% on cash-out. Loans range from $125,000 to $3,500,000. Cash-out proceeds never count as qualifying assets.
The minimums matter. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are the only income source, liquid assets can never be below $250,000. Asset-derived income may also supplement documented income up to a 45% debt-to-income ratio, and when it does, the minimum-assets rule is waived. Statements must be at least 120 days old at application, plus one recent statement within 45 days. Credit follows the lender’s matrix, and a first-time investor needs 700.
Which Path Fits Your IRA?
Pick by comparing your total usable assets to the loan.
| Question | Qualifier path | Depletion path |
|---|---|---|
| Assets must cover | The entire loan | Enough income via 60-month divisor |
| IRA credit | 90% under 59½, 100% after | 70% at any age |
| Income documented | None | Derived from assets |
| Debt-to-income test | Not run on income | Yes |
| Investment property | Not offered | Yes, at lower leverage |
Here is the trade-off. An IRA holder under 59½ gets better credit on the qualifier path, but needs enough total assets to cover the full loan. The depletion path accepts smaller balances relative to the loan, but the retirement haircut is heavier and the DTI test applies. Run both against your statements before choosing.
The Part That Gets People Hurt: Pledging
Counting an IRA is fine. Pledging it is not. The IRS retirement plan loan FAQ says that if an IRA owner pledges part of the account as security for a loan, the pledged part is treated as distributed. Borrowing directly from the IRA is worse: the account stops being an IRA and the whole value is included in income.
The consequences are concrete. According to Ed Slott and Company, a traditional, SEP or SIMPLE IRA owner is taxed on the pledged amount, the custodian may issue a Form 1099-R, and an owner under 59½ faces the 10% early-distribution penalty. A Roth is not exempt.
On asset-based files, the loan is secured by the home and nothing else. File hygiene matters here. Give the lender statements showing your name and vested balance, and do not sign anything that reads as a pledge. Tax treatment varies; consult a qualified professional.
What Counts, What Doesn’t
Retirement accounts must be vested and fully accessible. Several things are not published as eligible on either path: cryptocurrency, precious metals, collectibles, pledged or borrowed funds, and business accounts beyond your ownership share. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
On the depletion path, these are not eligible: 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.
An employer 401(k) is not an IRA, but both count under these programs at the percentages above.
A Self-Directed IRA Buying the Property Is a Different Animal
If the IRA itself is the buyer, this is not an asset-based mortgage on your personal file. The IRA is the borrower, and that calls for a non-recourse loan, according to Advantage IRA. Debt-financed deals can also create unrelated debt-financed income reported on Form 990-T. That is a niche structure, and it is not what the programs above describe. If that is your plan, a custodian and a tax professional come first.
Ohio Specifics
Nothing in the program changes by state. The figures above are the same for an Ohio borrower, and consumer mortgage lending through Lendmire is available in Ohio, among 16 licensed states. What is local is the home itself: the price, the county, the insurance and the title work. Those are context, not program parameters.
Documentation Checklist
1. Two months of statements for each qualifying account on the qualifier path, and 60 days of seasoning.
2. For the depletion path, statements at least 120 days old plus one within 45 days. Sale-of-business, inheritance and legal-settlement funds are excused from that seasoning.
3. Proof the account is in your name and vested, with no pledge language anywhere.
4. A credit profile that meets the program’s floor. Housing history is 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible.
5. A purchase contract or refinance details for the property.
Common reasons files stall: eligible balances fall short after haircuts, a recent deposit has no documented source, or an account is not fully accessible. A market drop between application and underwriting also shrinks the counted balance on securities and retirement holdings, so leave a cushion.
Who This Fits, and Who Should Look Elsewhere
This fits cash-heavy, income-light borrowers: retirees, business sellers, inheritance or settlement recipients, early-retired professionals, and portfolio households. If you have strong documented income, conventional or full-doc jumbo financing is usually the better route. If you document income through deposits, a bank statement program is built for that. Rental purchases are business-purpose and belong with DSCR. If you plan to withdraw from the IRA anyway, that is a different strategy with its own tax cost.
Frequently Asked Questions
Do I have to be retired to use my IRA this way?
No. Retirement status is not the test. The test is whether vested, accessible balances meet the program’s percentages and minimums, subject to underwriting. Early-retired, between-jobs and self-employed buyers use these programs too.
Does a Roth IRA count the same as a traditional IRA?
For program purposes, retirement accounts count at the percentages above. The pledge rule applies to Roth accounts too, so listing one as an asset is fine but pledging it is not.
Will the lender make me sell investments or draw down the account?
No withdrawal is required. The calculation shows the account could cover the obligation. The balance stays invested, though lenders review statements for large recent deposits and sourcing.
What if my account drops in value before the loan is underwritten?
The counted amount follows the most recent statements. A drop reduces usable assets, especially on securities and retirement accounts, so a cushion above the minimum helps.
Is this a no-documentation loan?
No. Every file is fully underwritten. There are no traditional personal-income documentation, pay stubs or employment verification, but the assets are documented with statements.
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, are subject to underwriting, and are 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. IRS – Retirement plans FAQs regarding loans
2. Ed Slott and Company – Don’t Pledge Your IRA
3. Advantage IRA – Self-directed IRA real estate 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 Qualify for an Ohio Mortgage on an Inheritance Without a Job · Can a Tennessee Widow Qualify for a Mortgage on Life Insurance and Retirement Assets? · Can You Get a Mortgage on Retirement Accounts Without Taking Withdrawals?
Guides: Asset-Based Mortgage in Ohio
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.