The Quick Read: It depends on which asset-based path you use, because the asset qualifier path asks for 60 days of seasoning and two months of statements per account, while the asset depletion path asks for statements at least 120 days old plus one recent statement, subject to underwriting. Seasoning means how long money has sat in your account, and sourcing means proving where it came from. A closed home sale gives you a strong paper trail, but a paper trail does not automatically replace the clock.
- Qualifier path: 60 days of seasoning and two months of statements for each qualifying account, through select programs.
- Depletion path: the oldest statement at least 120 days old at application, plus the most recent statement within 45 days.
- Excused on the depletion path: sale-of-business, inheritance and legal-settlement funds. A home sale is not on that list.
- The same dollars cannot do two jobs. Cash used for the down payment and closing costs stops counting as a qualifying asset.
- Colorado changes the paperwork flow, not the program figures. The settlement statement and the wire trail carry the proof.
This article covers the cash-heavy, income-light borrower: a retiree, a business owner who just sold, or a household living off a portfolio. These borrowers hold large balances and little documented income. The question is how soon freshly received sale cash counts toward the next purchase.
Which Path Are You On?
Pick the path first, because the seasoning clock follows the path. A borrower is qualified on one path at a time, and the two tables never blend.
On the asset qualifier path, eligible assets must equal or exceed the entire loan amount. No employment or income is documented. On the asset depletion path, eligible assets 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.
Sale cash usually fits one of two profiles. If the sale produced enough cash to cover the whole loan, the qualifier path is the natural fit. If the sale produced a large portfolio but not enough to cover the loan outright, the depletion path turns those assets into income. Both paths are documented. Income is not documented on the qualifier path, but assets always are.
| Item | Asset qualifier path | Asset depletion path |
|---|---|---|
| How assets are used | Cover the whole loan | Divided by 60 months into income |
| Seasoning and statements | 60 days; two months per account | Statements 120+ days old, plus one within 45 days |
| Purchase leverage | Up to 80% (principal residence or second home) | Up to 80% (principal residence or second home); 65% (investment property) |
| Credit | 600 minimum score | The lender’s score and loan-amount matrix |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
All figures are ceilings and floors through select programs, subject to underwriting. They are not offers.
Does Home-Sale Money Need to Season at All?
Across the wholesale network, the published seasoning terms do not carve out home-sale proceeds on the qualifier path. On the depletion path, the excused list names sale-of-business, inheritance and legal-settlement funds, and a home sale is not among them.
Some lenders will treat a well-documented home sale more flexibly than a plain deposit. That is a lender-by-lender call, and it is not something to build a purchase contract around. The safest approach is to ask before the money moves.
Lenders season funds to make sure the money is yours, is stable, and is not borrowed for the day. Seasoning answers one question. Sourcing answers another. A fresh deposit with a clean settlement statement behind it is easy to explain. A deposit with no paper trail is hard to explain at any age.
Lendmire’s piece Can Sale Proceeds Alone Qualify You for an Asset Depletion Loan? covers the qualification side of that question in more depth.
What Does the Seasoning Clock Look Like on Each Path?
Qualifier path. The 60 days run per account. Two months of statements for each qualifying account must show the balance. If you move sale cash into a new brokerage or savings account after closing, that new account starts its own history. Moving money between accounts mid-file creates new items to explain, so decide where the cash will live once and leave it there.
Depletion path. Here the test is about statement age. The oldest statement must be at least 120 days old at application, and the most recent statement must be within 45 days. A home-sale deposit received last month does not have a 120-day-old statement behind it. The exception covers sale-of-business funds, inheritance and legal settlements, and those are excused from this seasoning.
Say a borrower sells a house and wires the net proceeds into a new account. On the qualifier path, the 60-day mark and two statements come first. On the depletion path, the borrower either waits for the statement history or looks at whether the portion of assets that is already seasoned is enough on its own.
That second approach is often the practical one. Many sellers already hold older brokerage, retirement or savings balances. If those balances carry the file, the new cash only has to cover the down payment and closing costs, where the question is sourcing and not qualifying value.
How Does the Paper Trail Work in Colorado?
The proof is the final settlement statement, matched to the deposit. For a Colorado sale, the title company disburses the net proceeds, usually by wire. The underwriter traces the net-proceeds line on the settlement statement to the credit on your bank statement. The CFPB describes the HUD-1 settlement statement as listing all charges and credits to the buyer and seller, and that is the line-by-line view an underwriter uses. More recent sales use a Closing Disclosure, which does the same job.
The file usually needs these items:
1. The final settlement statement from the sale, showing the borrower’s name and the net proceeds.
2. The statement for the account that received the wire, showing the deposit.
3. If the money passed through another account first, statements for both accounts, so the chain is visible.
4. A short letter of explanation if the deposit is out of pattern for the account.
5. Updated statements near the end of the file, to re-verify the balances.
Account titling matters. Funds in a spouse’s or co-owner’s name need to tie to the borrower, and name mismatches between the settlement statement and the bank account are a common reason files stall. When two owners split the proceeds, the statement should show each share going to the right account.
Why Can’t Sale Cash Do Two Jobs?
The same dollars cannot fund the down payment and also count as qualifying assets. The down payment, closing costs and any reserves come out first, and what is left is what counts.
The sanctioned depletion shape shows how this works. A borrower holds $1,500,000 in securities (counted at 80%, or $1,200,000) plus $300,000 in cash (counted at 100%). That is $1,500,000 of usable assets, divided by 60 months, for $25,000 of monthly qualifying income. If part of that $300,000 in cash is sale money and it goes to the down payment, it leaves the usable total dollar for dollar. The qualifying income drops by one-sixtieth of whatever left. This is illustrative arithmetic, and the lender’s own calculation governs.
The qualifier shape works the same way. An $800,000 loan with $330,000 in brokerage accounts (100%), $300,000 in a 401(k) under age 59½ (90%, or $270,000) and $200,000 in savings (100%) counts $800,000 of usable assets and is reviewed on assets alone. Pull $100,000 of savings out for the down payment and that file no longer clears.
Minimums matter on the depletion path. 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 asset depletion is the only income source. Asset-derived income can supplement documented income up to a 45% debt-to-income ratio, and in that case the minimum-assets rule is waived.
What Counts, and What Doesn’t?
Sale cash lands in an account type, and the account type sets the credit. The percentages below are the share of the balance that counts.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Savings, money market, CDs | 100% | Cash accounts and CDs 100% |
| Brokerage accounts | 100% | Securities 80% |
| 401(k) and IRA | 90% under 59½; 100% at 59½+ | 70% at any age |
| Private stock | Not listed | 75% |
| Real-estate equity | Not listed | 60% |
Not eligible 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. Cryptocurrency, precious metals, collectibles and pledged or borrowed funds are not published as eligible on either path. The documented route for crypto and metals is to convert them to a cash balance in a regulated account and let the lender review the source.
One more trap on sale cash: cash-out proceeds from another property never count as qualifying assets on the depletion path. They are loan proceeds, not sale proceeds.
Seasoning by Source of Funds
This table shows how the usual fund sources are treated. Where a cell says the lender decides, that is a real answer and not a dodge. The program does not publish a rule.
| Source of funds | Proof needed | Does a wait apply? |
|---|---|---|
| Home sale | Settlement statement and deposit trail | Standard clock unless the lender confirms otherwise |
| Business sale | Sale agreement and wire confirmation | Excused on the depletion path |
| Inheritance or legal settlement | Estate or settlement documents | Excused on the depletion path |
| Retirement rollover | Both account statements | Standard clock applies |
| Crypto or metals | Conversion records and cash statements | Converted cash needs its own history |
| Borrowed or pledged funds | Not published as eligible | Not applicable |
What About 1031 Exchange Money?
Exchange funds do not season in your account, because they should never touch it. In a deferred exchange, the proceeds sit with a qualified intermediary and arrive at closing as a wire. The IRS explains that a like-kind exchange defers gain rather than eliminating it, and that cash received can trigger taxable gain. That makes personal handling of the money a real risk, so the borrower should not touch it.
The IRS deadlines are fixed. Under the IRS rules, as summarized by The Tax Adviser, replacement property must be identified within 45 days and received within 180 days, and the taxpayer cannot be in actual or constructive receipt of the money. Those are tax-code deadlines, not loan timelines. They do mean a lender that insists on aging your funds could put the exchange at risk. The paperwork for exchange money is the intermediary’s statement and the exchange agreement.
Exchange money also cannot do double duty. Cash that goes to the intermediary funds the replacement purchase and is not sitting in your account as a seasoned asset. Plan the qualifying assets separately from the exchange funds. Tax treatment varies; consult a qualified professional before relying on any exchange strategy.
Sell First or Buy First?
The sequence changes the seasoning problem.
| Path | Seasoning effect | Common trap |
|---|---|---|
| Sell first, then buy | Proceeds arrive before the file opens, so the clock can run | Moving the cash around after closing |
| Buy first, then sell | Sale cash is not available to qualify | Counting sale cash that has not arrived |
| Same-day swap | No time to season | Wire timing and name mismatches |
Sell-first gives the most room, since the 60-day mark or the statement history can build while you shop. Buy-first only works if the assets already on your statements carry the file. Counting money that has not yet landed does not hold up in review.
Lendmire’s article How to Qualify on Home-Sale Proceeds Using an Asset Depletion Mortgage walks through that side of the sale in more detail.
Common Mistakes on Sale-Proceeds Files
Moving the money after the deposit. Every transfer creates a new account history and a new document to explain. Leave the cash where it landed.
Counting the same cash twice. The down payment and the qualifying total come from the same pool. Subtract first, then count.
Assuming old equals sourced. An old balance with no statement trail still raises questions, and a new deposit with a clean settlement statement is easier to document. Time and paper are separate tests.
Treating sale proceeds as income. Proceeds are an asset. On the depletion path they become qualifying income only through the 60-month division and the lender’s debt-to-income test.
Skipping the lender question. Because the published rules do not carve out a home sale, ask which clock your file is on before you list the old house or sign the new contract.
Key Terms Defined
Seasoning: the length of time funds have sat in your account.
Sourcing: documenting where a deposit came from, such as a settlement statement or wire confirmation.
Net qualifying assets: the balance left after the down payment and closing costs come out and the credit percentage is applied.
Asset qualifier path: the route where eligible assets cover the entire loan and no income is documented.
Asset depletion path: the route where usable assets are divided by 60 months into qualifying income.
Qualified intermediary: the third party that holds 1031 exchange funds so the borrower never touches them.
What If You Are Buying a Pure Rental?
Everything above applies to a consumer mortgage, and that loan carries standard consumer disclosures. If the property is a rental you are buying purely as an investment, a different program may fit better. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines, and asset review there is mostly about closing funds and reserves. Lendmire’s complete DSCR loans guide explains how that works. The asset depletion path also allows investment property, at the lower leverage shown above.
Frequently Asked Questions
Do I have to wait 60 days after selling my house?
On the asset qualifier path, plan on 60 days of seasoning and two months of statements for each qualifying account, through select programs and subject to underwriting. A lender may treat a documented sale more flexibly, but that is not a published rule. Ask before you move the money.
Does the depletion path ever excuse the wait?
Yes, for sale-of-business, inheritance and legal-settlement funds. Those are excused from the statement-age requirement. A home sale is not on that list, so the standard 120-day-old statement plus one within 45 days is the safe planning assumption.
Can the same sale money fund the down payment and count as qualifying assets?
No. Down payment and closing funds come out first, and only what remains counts at its credit percentage. On the depletion path, every dollar that leaves reduces the monthly qualifying income by one-sixtieth of that dollar.
What proves the money is mine?
The final settlement statement and the account statement showing the matching deposit. If the money moved through another account, both accounts’ statements show the chain. A short letter of explanation helps when the deposit is out of pattern.
Does the program change if I live in Colorado?
The program figures do not change by state. Colorado affects the paperwork flow, mainly the title company’s settlement statement and wire. The loan is a consumer mortgage with standard consumer disclosures, and Colorado is one of the 16 states where Lendmire’s consumer lending is licensed.
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 is a broker that arranges financing through select lenders. Terms are subject to underwriting and are not a commitment to lend.
Lendmire’s asset-based mortgage in Colorado page presents the program for Colorado borrowers.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. IRS FS-2008-18 Like-Kind Exchanges (archival)
3. The Tax Adviser, Like-Kind Exchanges of Real Estate: Building on the Basics
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Get an Asset Depletion Mortgage After a Foreclosure or Short Sale? · Is an Asset-Based Mortgage Reported to Credit Bureaus Like Any Other Mortgage? · How Much Down Payment Does an Asset Depletion Jumbo Loan Need?
Guides: Asset-Based Mortgage in Colorado
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.