The Quick Read: It depends on the assets, but on the asset depletion path $1 million of fully countable cash produces about $16,667 of monthly qualifying income, while $1 million held in retirement accounts produces about $11,667, subject to underwriting and the lender’s own calculation. Qualifying income here is a number the lender builds from your balances. It is not what your portfolio earns, and nothing gets sold.
- The formula: usable assets divided by 60 months, on the asset depletion path.
- Usable means after credit percentages: cash and certificates of deposit count at 100%, securities at 80%, retirement accounts at 70%.
- Money for the deal usually comes out first: the same dollar cannot fund the down payment and the income.
- Rule of thumb: every $100,000 of usable assets adds about $1,667 of monthly qualifying income.
- A second path exists: the asset qualifier path skips the income math and asks whether your assets cover the whole loan.
Qualifying Income Is a Formula, Not Portfolio Yield
Search this question and you will land on pages about what $1 million earns in dividends. Those pages answer a different question, because a lender running an asset depletion loan does not care what your portfolio pays out.
The lender takes a balance, applies a credit percentage to each account, and divides the total by a fixed number of months. That fixed number is the divisor. The result is a monthly figure that goes into the debt-to-income test (DTI), which compares your monthly obligations to your monthly income. The lender treats the result the way it would treat a salary.
Your accounts stay invested. You do not spend them down. The formula only translates a balance sheet into something the income test can read.
This is for the cash-heavy, income-light borrower. Think of a retiree, someone who just sold a business, a person who received an inheritance or settlement, an early-retired professional, or a household living off a portfolio. Big balances, thin documented income.
Two Paths, and You Are on One at a Time
Through select programs in Lendmire’s wholesale network, asset-based mortgages come in two forms. Each tests something different, and a borrower is reviewed on one path at a time. Never blend the two tables below.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| What is tested | Assets must cover the whole loan | Assets become monthly income |
| Income documented | None | Derived income only, or added to real income |
| Loan size | Up to $4,000,000 | $125,000 to $3,500,000 |
| Property types | Primary home, second home | Primary, second home, investment property |
The qualifier path asks one question: do your eligible assets, after the credit percentages, equal or exceed the entire loan amount? If yes, you qualify on assets alone. Typical leverage runs up to 80% loan-to-value on a purchase and 75% on a refinance, on a primary residence or second home.
Here is an example for that path. Take an $800,000 loan. You hold $330,000 in brokerage accounts (100% counts), $300,000 in a 401(k) while under age 59½ (90% counts, so $270,000), and $200,000 in savings (100% counts). That is $800,000 of usable assets, enough to qualify on assets alone, subject to underwriting.
The depletion path is the one this article is about. It converts usable assets into monthly income, and that income has to carry the housing payment and your other debts. Typical leverage on a primary residence or second home runs up to 80% on a purchase or rate-and-term refinance and 60% on a cash-out refinance. Cash-out proceeds never count as qualifying assets.
What Does $1 Million Actually Produce?
On the depletion path, the answer swings by about 40% depending on what the $1 million is made of. The formula is the same every time: balance, times the credit percentage, divided by 60.
| Your $1,000,000 is held as | Counts at | Usable assets | Monthly qualifying income |
|---|---|---|---|
| Cash and CDs | 100% | $1,000,000 | $16,667 |
| Half cash, half securities | 100% / 80% | $900,000 | $15,000 |
| Securities | 80% | $800,000 | $13,333 |
| Private stock | 75% | $750,000 | $12,500 |
| Retirement accounts | 70% | $700,000 | $11,667 |
| Real-estate equity | 60% | $600,000 | $10,000 |
These are illustrative figures, not offers. The lender’s own calculation governs.
A bigger example shows how a mixed file works. Say you hold $1,500,000 in securities, which count at 80% for $1,200,000, plus $300,000 in cash at 100%. That is $1,500,000 of usable assets. Divided by 60 months, it produces $25,000 of monthly qualifying income. That number then carries the housing payment and other debts through the DTI test.
Notice the retirement row. A retirement balance counts at 70% on the depletion path at any age. Retirement balances count for less partly because early withdrawals can cost money; the IRS, for example, generally applies a 10% additional tax to IRA distributions before age 59½, and tax treatment varies, so consult a qualified professional. On the qualifier path, the treatment is gentler: 90% under age 59½ and 100% at 59½ or older.
Why $1 Million Is Rarely the Number You Divide
Most people start with a gross balance and divide it. Lenders usually start further down the page. Money committed to the deal comes out of the pool first, because one dollar cannot do two jobs.
Run the numbers on a borrower with $1,000,000 in cash who needs $200,000 for the down payment and closing costs. That leaves $800,000 of usable assets. Divided by 60 months, the result is about $13,333 of monthly qualifying income, not $16,667. A modeled example, yes. But the gap between those two figures is meaningful, and it is why this step matters.
Several other things shrink the countable pool:
- Ineligible accounts. On the depletion path, 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 do not count.
- Crypto, precious metals, collectibles, and borrowed money. These are not published as eligible 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.
- Business accounts. Only the borrower’s ownership share is a candidate, and it still faces review.
- Market movement. If your securities fall before the lender pulls the final statement, the countable pool shrinks with them.
Seasoning matters too. Seasoning means how long money has sat in your accounts. On the depletion path, the file needs statements at least 120 days old plus the most recent statement within 45 days. Funds from the sale of a business, an inheritance, or a legal settlement are excused from that seasoning. On the qualifier path, the standard is 60 days of seasoning and two months of statements for each qualifying account.
Both paths document the assets. “No income documentation” never means “no documentation.” Expect to show where every dollar came from.
How Many Assets Do You Need for a Target Income?
Run the math backward. Multiply the monthly income you need by 60 and you get the usable assets required. Divide that by the credit percentage to find the raw balance.
| Monthly income needed | Usable assets | Raw balance if all cash | Raw balance if all securities |
|---|---|---|---|
| $5,000 | $300,000 | $300,000 | $375,000 |
| $10,000 | $600,000 | $600,000 | $750,000 |
| $15,000 | $900,000 | $900,000 | $1,125,000 |
| $20,000 | $1,200,000 | $1,200,000 | $1,500,000 |
| $25,000 | $1,500,000 | $1,500,000 | $1,875,000 |
For a quick scale, $100,000 of usable assets adds a modest, predictable slice of qualifying monthly income. That is the proportion to carry in your head.
One more floor to know about. The depletion path typically requires qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. It also requires at least $250,000 in liquid assets when asset depletion is your only income source. So $1 million sits right at the ceiling of that minimum. Whether the lender tests the balance before or after the credit percentages is a point to settle early. (A file built entirely on securities can look different at 80% than at face value.)
From Qualifying Income to Buying Power
Qualifying income is only the first step. The derived income has to cover the full housing payment plus your other monthly debts, and the lender divides your total obligations by that income to get the DTI.
Here is the practical read. Every dollar of qualifying income is a dollar of capacity. A borrower whose $1 million of cash produces a solid qualifying income has a lot of room. The same borrower with $200,000 already committed to a down payment has less. And a borrower carrying large car loans or other debts has less still.
You can also stack income. Asset-derived income can supplement documented income, such as Social Security, a pension, or part-time earnings, up to a 45% DTI. When it supplements real income, the minimum-assets rule is waived. That matters for a retiree whose Social Security covers part of the payment and whose portfolio fills the gap.
Credit still applies. The qualifier path publishes a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix, and a first-time investor on that path typically needs 700. Housing history is expected to be clean, 0x30x12, though one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible, and a housing event typically needs 4 years of seasoning on the depletion path.
A pattern Lendmire’s brokers see across comparable files: borrowers focus on the divisor and overlook the statement dates. A file with a large balance and a stale or incomplete statement set stalls, while a smaller, cleaner file moves forward. Pulling every account’s statements before you pick a path avoids that surprise.
Why Two Lenders Can Read the Same File Differently
Asset depletion is not a single federal formula. The CFPB’s compliance guide for the Ability-to-Repay rule lists current or expected income or assets as the first factor a lender must weigh, and it sets no specific debt-to-income threshold. So the divisor, the credit percentages, and the DTI limit are each program policy.
That is why shopping matters. A long divisor, which agency-style programs lean toward, can shrink the same $1 million into a fraction of the income a 60-month divisor produces. The spread between lenders can run several-fold. Agency products also use their own eligibility rules, so keep their figures out of this table.
Across Lendmire’s wholesale network, the strictest overlays want deeper statements and higher minimum assets. Others are more flexible on leverage. The 60-month divisor and the credit percentages above reflect select programs, subject to lender guidelines, and are never a promise. Lendmire is a broker, so it compares options across lenders rather than lending itself.
Does This Make Sense for a Rental Investor?
Often not. Here is the straight answer: if the rent on a property comfortably covers its payment, you probably do not need asset depletion at all. A DSCR (debt service coverage ratio) loan is a business-purpose investor loan that qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. It tests the rent, not your balance sheet.
Asset depletion fits a different borrower. It suits the person buying a primary residence or second home whose traditional personal-income documentation understates real capacity. It also suits someone whose rental coverage is thin and who holds large balances. On an investment property, the depletion path caps typical leverage at 65% on a purchase or rate-and-term refinance and 60% on a cash-out, so expect to bring more cash than a standard rental loan asks. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
Honestly, this is a toss-up for many investors. Asset depletion keeps the portfolio invested and compounding, which is a real advantage. But it ties up balances you might want for the next acquisition. If most of your wealth sits in retirement accounts, the 70% credit percentage shrinks the pool. Lendmire’s article Retirement Assets vs Liquid Assets in Asset Depletion Qualifying covers that tradeoff.
Common Estimating Mistakes
Most errors come from the same few habits:
- Dividing the gross balance. Credit percentages and deal money come out first.
- Double-counting. The same dollars cannot fund the down payment, the minimum assets, and the income.
- Counting ineligible assets. Crypto, stock options, and unvested shares contribute nothing as-is.
- Assuming one divisor everywhere. Programs differ. A different lender can produce a very different number.
- Ignoring volatility. A drop in your portfolio between application and the final statement lowers the countable pool.
- Treating non-QM as skipping the review. Every file is underwritten individually, and the lender still has to be satisfied you can repay.
Key Terms Defined
Qualifying income: the monthly figure a lender uses in the debt-to-income test, here calculated from assets rather than a paycheck.
Divisor: the number of months you divide usable assets by. The depletion path uses 60.
Credit percentage (haircut): the share of an account’s balance that counts toward usable assets.
Usable assets: your balances after the credit percentages and after money set aside for the deal.
Seasoning: how long funds have sat in your accounts, proven by statements.
Debt-to-income ratio (DTI): your monthly debts divided by your monthly income.
Frequently Asked Questions
Do I have to sell my investments to qualify?
No. The accounts stay invested. The lender only uses the balances to calculate a qualifying income figure, or on the qualifier path to confirm the assets cover the loan. You still document ownership, value, and seasoning.
Can I use my 401(k) or IRA?
Yes, through select programs. On the depletion path retirement accounts count at 70% at any age. On the qualifier path they count at 90% under age 59½ and 100% at 59½ or older. Both are subject to underwriting.
Is $1 million enough?
It clears the typical minimum-assets test, which is the lesser of $1,000,000 or 1.25 times the loan balance, and never below $250,000 liquid when assets are your only income source. Whether it supports the loan you want depends on the asset mix, the deal money set aside, and your other debts.
Can I combine asset income with Social Security or a pension?
Yes. Asset-derived income can supplement documented income up to a 45% DTI, and the minimum-assets rule is waived when it supplements. The lender’s calculation governs.
Will crypto or cash-out proceeds count as qualifying assets?
No. Cryptocurrency is not published as eligible on either path, and the documented route is converting it to a seasoned cash balance in a regulated account.
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’s consumer mortgage programs are available in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia, and Washington. Every file is underwritten individually, 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. IRS Topic 557, Additional Tax on Early Distributions
2. CFPB ATR/QM Small Entity Compliance Guide
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 Much Does a Michigan Retiree Need in Assets to Buy a Home Without Income? · How Much of a Brokerage Account Counts Toward Asset Depletion Income? · Can You Buy a California Rental Property on Asset Depletion Income?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.