The Quick Read: Yes, but only the part of the settlement that has been paid, sits in your own name, and can be documented with statements. A decree proves money is owed. It does not prove the money is in your account. Once the funds arrive and season, they can serve as qualifying assets through select asset-based programs, subject to underwriting.
- Paid and deposited money counts. A promised or pending payment does not.
- Funds need to be in your sole name, not a joint account or your ex’s.
- One program path covers the loan with assets alone. The other turns assets into monthly income.
- Cash used for the down payment cannot also be counted as reserves or qualifying assets.
- Retirement money counts only after the transfer completes and statements exist.
What a Lender Sees in a Settlement
A lender sees statements, not paperwork about the future. Your decree is context. The balance on a statement is the evidence.
Ohio’s property division statute, Ohio Revised Code § 3105.171, requires an equitable division of marital property before any spousal support award. It also defines a “distributive award”: a payment in real or personal property, made in a lump sum or over time in fixed amounts, that is not spousal support. A court can use one when dividing property in kind would be impractical.
Here is the lending consequence. An installment-style award is a receivable, not cash. Only the installments already received and deposited count. Future payments do not, even when a lien secures them.
This article covers the Ohio divorce frame. Lendmire arranges consumer asset-based mortgages for Ohio borrowers through select lenders in its network, and every file is underwritten individually.
Which Settlement Pieces Count?
Each piece of a settlement lands differently. Sort yours before you talk to any lender.
| Settlement piece | Counts as an asset? | What has to be true |
|---|---|---|
| Cash equalization payment | Yes | Received, deposited, sole name |
| Home sale proceeds | Yes | Closed, paid out, deposited |
| Home equity buyout | Only once paid | Cash received, not just awarded |
| Retirement share (QDRO) | Yes, discounted | Transfer done, statements in your name |
| Brokerage account awarded | Yes | Retitled to you, statements available |
| Deferred or installment award | Only paid portions | Each installment deposited |
| Spousal support | Not an asset | Separate from property division |
Ohio treats spousal support separately from property. It is not part of the settlement assets we are talking about here. Whether support can be income is a different question that depends on the program.
Two Paths: Assets Cover the Loan, or Assets Become Income
A borrower is reviewed on one path at a time. Pick the one that fits your balances.
The asset qualifier path. Your eligible assets must equal or exceed the entire loan amount. You supply no traditional personal-income documentation, pay stubs or employment verification, though the assets themselves are fully documented and the file is fully underwritten. Through select programs, leverage runs up to 80% on a purchase and 75% on a refinance, with loans up to $4,000,000, subject to underwriting. The credit score floor is 600.
Credit for assets on this path:
- Brokerage, certificates of deposit, money market and savings: 100%.
- Retirement accounts: 90% under age 59½ and 100% at 59½ or older.
- Accounts combine.
Here is an illustration. Picture an $800,000 loan backed by $330,000 in brokerage accounts (100% counts, so $330,000), $300,000 in a 401(k) held under 59½ (90%, so $270,000) and $200,000 in savings (100%, so $200,000). That is $800,000 of usable assets, which matches the loan. The lender’s own calculation governs.
The asset depletion path. Usable assets are divided by 60 months to produce a monthly qualifying income. That income then carries the housing payment and your other debts through the debt-to-income test. Loans run $125,000 to $3,500,000, and the lender’s score and loan-amount matrix sets the credit requirement.
Credit for assets on this path:
- Cash accounts and certificates of deposit: 100%.
- Securities: 80%.
- Private stock: 75%.
- Retirement accounts: 70% at any age.
- Real-estate equity: 60%.
An illustration: $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100%) gives $1,500,000 usable. Divided by 60 months, that is $25,000 of monthly qualifying income, which then has to carry the housing payment and other debts.
Depletion has minimums. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. If depletion is your only income source, you also need no less than $250,000 liquid.
Leverage on depletion is up to 80% on a purchase or rate-and-term refinance of a principal residence or second home, and 60% on a cash-out. On an investment property, it is up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. Cash-out proceeds never count as qualifying assets. Details are on Lendmire’s asset-based mortgage program page.
Seasoning and Source Documents
Settlement money is usually new money, and lenders want to see where it came from.
On the qualifier path, funds need 60 days of seasoning, with two months of statements for each qualifying account. On the depletion path, statements must be at least 120 days old at application, plus the most recent statement within 45 days. Legal-settlement funds are excused from that depletion seasoning, which helps a recent recipient. Subject to underwriting, expect the lender to review the source regardless.
Build a clean file:
1. The decree or separation agreement.
2. The closing statement if the marital home sold.
3. The paying spouse’s transfer record or the payment instructions.
4. Statements showing the deposit in your sole name.
5. Statements for any retirement or brokerage account retitled to you.
Large, unexplained deposits slow files down. A decree plus a matching deposit tells a clean story.
Retirement Money Needs Sequencing
Retirement is where divorce files stall. A pending transfer means the account is not yet yours, and no statement in your name exists.
The IRS explains in Publication 504 that a qualified domestic relations order (QDRO) is a court order, including an approved property settlement agreement, recognizing a former spouse’s right to benefits from a qualified plan. Benefits paid to you under a QDRO generally count as your income, but an eligible rollover distribution may be rolled tax-free into an IRA or another qualified plan.
Ohio public pensions work differently. A law-firm explainer notes they use a Division of Property Order rather than a QDRO. Either way, a pension share not yet paid out is not liquid cash.
Once a rollover lands in an IRA in your name, it is a retirement account on a statement. On the qualifier path it counts at 90% under 59½ and 100% after. On the depletion path it counts at 70%. Taking money out early can carry a tax cost, so talk to a tax professional before liquidating anything.
Where the General Rule Bends
Edge cases decide many files. These come up most often.
- Installment awards. Only received money counts, as covered above.
- Separate property. Premarital assets, inheritances and gifts generally stay with the original owner if traceable, per a secondary legal-information source. Your settlement may be smaller than a 50/50 split would suggest, since Ohio starts from an equal-division presumption but can deviate.
- Financial misconduct. Section 3105.171(E), reproduced on FindLaw, lets a court compensate the other spouse with a distributive award or a greater share. That can change the cash you actually receive.
- Crypto, metals, collectibles. None of these is published as an eligible asset class on either path. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
- Borrowed or pledged funds. These are not published as eligible either.
- Double counting. Cash used for a buyout, closing costs or a down payment is spent. It cannot also be counted as qualifying assets.
Property transfers between spouses or former spouses because of a divorce generally produce no recognized gain or loss under the IRS’s property settlement guidance. Tax treatment varies; consult a qualified professional.
The Decree Does Not Remove You From the Loan
Signing over a deed does not release you from an existing mortgage. The lender’s loan stays in both names until it is paid off or refinanced. If your ex keeps the house, you may still carry that debt on your credit and in the next lender’s review. Plan the payoff or refinance before you apply for something new.
Who Should Use Which Path?
If your settlement left you with large cash and brokerage balances and little documented income, the asset qualifier path is usually the cleaner fit. Assets cover the loan outright, with no income test. If your balances are big but you want the loan sized by income, depletion converts them, though leverage is lower and the minimums are higher.
Say you receive a cash equalization payment and a rolled-over IRA. Both can count once seasoned. But money you plan to spend on the buyout of an ex’s share is gone before the lender looks.
Investors take note: this section describes a consumer program, and the depletion path is the one that allows investment property, where the loan is business-purpose. If you are buying a pure rental and the property’s income carries the payment, a rental-income program may fit better. In that case, the settlement cash mainly funds the down payment and reserves.
Plan before you sign. When you negotiate the settlement, ask which accounts you will receive, in what form, and when. Cash in your name and a completed rollover are far more usable than a promise.
Frequently Asked Questions
Can I use a divorce settlement I have not received yet?
No. An unpaid or deferred award is a receivable, not an asset. Only installments already received and deposited in your name count. Once each payment lands and the statements show it, that money joins your qualifying balance.
Does alimony count as an asset?
No. Ohio treats spousal support separately from property division. It is not a settlement asset. Whether support can serve as income depends on the program and its documentation rules, subject to lender guidelines.
Do I need two months of statements on settlement cash?
On the asset qualifier path, yes: 60 days of seasoning and two months of statements per account. On the depletion path, legal-settlement funds are excused from the 120-day seasoning, but the lender still reviews the source, subject to underwriting.
Can I count a 401(k) I got through a QDRO?
Yes, after the transfer or rollover completes and statements appear in your name. It counts at 90% under 59½ and 100% after on the qualifier path, or 70% on the depletion path.
Does a decree take me off the old mortgage?
No. The lender holds both borrowers liable until the loan is paid off or refinanced. Plan that step before applying for a new loan.
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. Call 828-256-2183 to talk it through. Program details change, and nothing here is a commitment to lend.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage brokerage serving self-employed and high-net-worth borrowers in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending channels; Lendmire brokers the financing and the lender underwrites each application. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Ohio Revised Code § 3105.171
3. Meade Law Group, QDRO in Ohio
4. Divorce.law, Ohio property division
5. FindLaw, Ohio Rev. Code § 3105.171
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 Document an Ohio Asset Qualifier Mortgage Without an Employer · Can a New Mexico Trust Beneficiary Qualify for a Mortgage on Trust Assets? · How to Refinance an Ohio Mortgage After Retiring With No W-2 Income
Guides: Asset-Based Mortgage in Ohio
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.