The Quick Read: On an asset qualifier mortgage, a purchase gets the higher leverage ceiling, up to 80% loan-to-value on a principal residence or second home, while a refinance tops out at 75%, and in both cases eligible assets must cover the entire loan amount, subject to underwriting.
- Purchase: up to 80% loan-to-value on the asset qualifier path, through select programs.
- Refinance: up to 75% on the same path. Whether cash-out proceeds are allowed is set by the lender and is not published.
- Same test both ways: eligible assets, after the credit percentages, must equal or exceed the whole loan, and no employment or income is documented.
- Loan size: up to $4,000,000 on this path, for either transaction.
- Assets are still documented: 60 days of seasoning and two months of statements per qualifying account.
Here is the honest answer. A purchase suits a cash-rich buyer who wants the most borrowing room against a home they have not owned yet. A refinance suits an owner who wants to restructure an existing loan without documenting income, and who accepts a lower ceiling because the lender is lending against a property you already hold. Neither one is better in general. The right choice depends on how much equity you have, how much cash you want to keep, and which way the asset math falls on your statements.
Side-by-Side
On the asset qualifier path, the two transactions share most of their rules. The differences are the leverage ceiling, the reserve trigger, and the paperwork that comes with owning the property already. This table covers the qualifier path, for a principal residence or second home, through select programs and subject to underwriting.
| Factor | Purchase | Refinance |
|---|---|---|
| Maximum leverage | Up to 80% LTV | Up to 75% LTV |
| Review basis | Eligible assets cover the whole loan | Same |
| Income documentation | None; assets are documented | None; assets are documented |
| Loan amounts | Up to $4,000,000 | Up to $4,000,000 |
| Account seasoning | 60 days; two statements per account | Same |
| Credit floor | 600 minimum score | Same |
| Reserves | Lender sets them above 75% LTV | None required at or below 75% LTV |
| Cash-out proceeds | Not applicable | Lender-set; not published |
| Extra paperwork | Contract and funds to close | Existing payoff and title history |
Two rows deserve a second look. The reserve row means a purchase at the full 80% leverage sits above the no-reserve line, so the lender decides what reserves apply. A refinance at 75% or lower sits at that line. The cash-out row is blank on purpose. Across the wholesale network, that figure varies by lender, so no honest national number exists for it.
Key Terms Defined
Loan-to-value (LTV) is the loan amount divided by the property’s value, expressed as a percentage.
Leverage is how much of the property’s value you borrow rather than fund yourself.
Asset qualifier path drives lender review on assets alone. After the credit percentages, eligible assets must equal or exceed the entire loan amount.
Asset depletion path converts usable assets into monthly income by dividing them by 60 months. That income then runs through the debt-to-income test.
Rate-and-term refinance replaces an existing loan without pulling out extra cash.
Cash-out refinance replaces an existing loan with a larger one and pays you the difference.
Seasoning is the length of time assets must sit in an account before they count.
Why Refinance Leverage Runs Lower
A refinance carries less leverage because the lender loses the best evidence of value it has. On a purchase, a buyer and seller agreed on a price. On a refinance, the value rests on an appraisal alone, and the borrower already holds the title.
That gap shows up in three ways. First, the price is observed on a purchase and estimated on a refinance. Second, a buyer who puts down 20% has committed fresh cash to the property, while a refinancing owner is only restructuring. Third, the lender wants a cushion against an appraisal that proves optimistic, and a 25% equity margin is that cushion on this path. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
This is the lender’s logic, not a rule of nature. The 5-point gap on the qualifier path is a published ceiling, and individual files can land lower after underwriting.
When a Purchase Is the Better Fit
Choose a purchase when you are buying a home and want the most borrowing room. Up to 80% LTV on the qualifier path means you fund as little as 20% of the price yourself, before closing costs, through select programs. Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
A purchase fits several kinds of borrowers well:
- A seller of a business or an heir: your balances are large and sit in seasoned accounts, but your documented income is thin or irregular.
- A retiree living off a portfolio: the portfolio carries the loan, so you do not have to sell investments and trigger a gain.
- A buyer who wants to keep liquidity: borrowing against the home leaves more cash invested than paying all cash would.
Purchase has trade-offs. The contract sets a clock, and the 60-day account seasoning has to be satisfied before the accounts count. Moving funds into an account late can leave those dollars out of the usable total. Also, the cash you spend on the down payment and closing costs may leave the very accounts that qualify the loan. Ask your lender whether assets are counted before or after funds to close, because the lender’s own calculation governs.
When a Refinance Is the Better Fit
Choose a refinance when you already own the home and want to restructure the loan without documenting income. The ceiling is 75% LTV on the qualifier path, for a principal residence or second home, which means you keep at least 25% equity in the property. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
A refinance suits a different set of borrowers:
- An owner whose income dropped: a retiree, a person between jobs, or someone who left salaried work can still qualify on assets alone.
- An owner who wants fewer reserve questions: at or below 75% LTV, this path requires no reserves.
- A borrower who wants a cleaner purchase decision later: restructuring first, then buying, keeps two files from tangling. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
Refinancing has costs of its own. The file adds the existing payoff and the title history, so it is not lighter on paperwork than a purchase. If your plan involves taking cash out, understand that the qualifier path does not publish a cash-out figure. The lender sets it, and you should get that answer before you plan around proceeds. Tax treatment varies; consult a qualified professional.
What Changes on the Asset Depletion Path
Everything above is the qualifier path. The depletion path has its own table, and you should not blend the two. On depletion, usable assets divided by 60 months become qualifying income, and the debt-to-income test then has to be passed.
Here the gap between a purchase and a cash-out is much wider:
- Principal residence or second home: up to 80% on a purchase or rate-and-term refinance, and 60% on a cash-out.
- Investment property: up to 65% on a purchase or rate-and-term refinance, and 60% on a cash-out.
- Loan amounts: from $125,000 to $3,500,000.
- Cash-out proceeds: they never count as qualifying assets.
The asset credit differs as well. On depletion, cash and certificates of deposit count at 100%, securities at 80%, private stock at 75%, retirement accounts at 70% at any age, and real-estate equity at 60%. On the qualifier path, brokerage, CD, money market and savings balances count at 100%, and retirement accounts count at 90% under age 59½ and 100% after.
Depletion also carries minimums. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance, and never below $250,000 liquid when depletion is the only income source. Credit follows the lender’s matrix, and a first-time investor on this path needs a 700 score. Statements must be at least 120 days old at application, plus the most recent one within 45 days.
A Worked Example
Consider a borrower with an $800,000 loan on the qualifier path. Her accounts hold $330,000 in brokerage accounts, $300,000 in a 401(k) and $200,000 in savings. She is under 59½.
Brokerage and savings count at 100%, which is $330,000 and $200,000. The 401(k) counts at 90% under 59½, which is $270,000. Her usable assets total $800,000, which equals the loan. She is reviewed on assets alone, subject to underwriting.
Now run her on the depletion path instead. Say she holds $1,500,000 in securities and $300,000 in cash. Securities count at 80%, which is $1,200,000, and cash counts at 100%, which is $300,000. Usable assets are $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 her other debts through the debt-to-income test.
Those two borrowers use different tools. The first needs her assets to cover the loan outright. The second turns assets into income. These figures are illustrative, and the lender’s own calculation governs.
Where Neither Option Fits
Asset-based mortgages of this kind are consumer loans, and the qualifier path is written for a principal residence or second home. A pure rental purchase usually belongs somewhere else. Investment property appears only on the depletion path, at 65% and 60% leverage.
For a rental that pays for itself, DSCR is the better tool. DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. The loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Lendmire’s complete DSCR loans guide walks through that path.
The regulatory split follows the same line. The Truth in Lending rule exempts credit extended primarily for a business or commercial purpose, and the official regulation text says the same. An asset-based mortgage on your home is a consumer loan, so consumer disclosures apply to it. A business-purpose DSCR loan is exempt from them. That is why one page cannot cover both.
The Balanced Verdict
Leverage favors a purchase. On the qualifier path, that is 80% against 75%, and the gap grows on the depletion path. A purchase also asks for more of your cash up front and lets the lender set reserves at the top leverage.
A refinance trades borrowing room for simplicity at the leverage line. It carries no reserve requirement at or below 75% and keeps you in a property you already know. Its cost is the unpublished cash-out figure and extra title and payoff paperwork. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
If you are buying, ask what the loan looks like at 80% and at a lower leverage that avoids reserves. If you own, price the refinance at 75% or lower first, and treat any cash-out as a separate question. In both cases, check whether your assets clear on the qualifier path before you consider depletion. Either route is subject to lender guidelines and underwriting, and neither is a commitment to lend.
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 broker that arranges consumer mortgages through select lenders in its network, and its consumer 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.
Frequently Asked Questions
Does a refinance on the qualifier path always cap at 75%?
Through select programs, 75% is the published ceiling for a refinance of a principal residence or second home on the qualifier path. Individual lenders can set it lower after reviewing the file. Cash-out proceeds are a separate matter, and the lender sets that leverage without publishing it.
Do I need reserves on a purchase at 80%?
At or below 75% LTV, the qualifier path requires no reserves. Above that line, the lender sets them. A purchase at the full 80% therefore sits above the line, and the lender decides the amount. Ask for that figure at the start. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
Can my retirement account count toward the loan?
Yes, with a haircut on the qualifier path. A 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older. On the depletion path, retirement accounts count at 70% at any age. Accounts combine, and statements still have to be seasoned and documented.
Is this the same thing as a no-doc loan?
No. Income and employment are not documented on the qualifier path, but your assets are. You provide two months of statements for each qualifying account after 60 days of seasoning. Credit is also reviewed, with a 600 minimum score on that path.
Can I use either option on a rental property?
Not on the qualifier path, which covers principal residences and second homes. Investment property appears only on the depletion path, at 65% on a purchase or rate-and-term refinance and 60% on a cash-out. A rental that covers its own payment more often belongs in a DSCR loan.
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.
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References
1. CFPB, Regulation Z § 1026.3: Exempt Transactions
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 Lenders Count Assets Toward an Asset Depletion Mortgage · Asset Qualifier Mortgage vs Bank Statement Mortgage · How Asset Qualifier Mortgage Loan Limits Work
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.