The Quick Read: Yes, through select programs: on the asset depletion path, a principal residence can be refinanced for cash at up to 60% loan-to-value, subject to underwriting, while the asset qualifier path leaves cash-out leverage to the lender and does not publish it, and a DSCR rental loan can never pull cash from a home you live in. Both asset-based paths are consumer mortgages that verify your assets. Neither one tests rental income.
- Asset depletion path: cash-out on a principal residence or second home tops out at 60% LTV, and loans run from $125,000 to $3,500,000.
- Asset qualifier path: refinance leverage goes up to 75%, but whether cash-out proceeds are allowed is the lender’s call and is not published.
- Cash-out proceeds never count as qualifying assets on the depletion path.
- DSCR is the wrong tool for equity in the home you live in. It is built for non-owner-occupied rentals. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
Pledge nothing, sell nothing: the portfolio stays invested. What changes is how the lender reads it. One path counts it as a cushion that covers the whole loan. The other turns it into monthly income.
What Do the Two Asset-Based Paths Actually Do?
The asset qualifier path covers the entire loan with eligible assets and documents no employment or income. The asset depletion path divides usable assets by 60 months to create qualifying income, which then runs through the debt-to-income test. A borrower is qualified on one path at a time. Never blend the two tables.
Qualifier path. Eligible assets, after the credit percentages, must equal or exceed the whole loan amount. Brokerage accounts, CDs, money market and savings count at 100%. Retirement accounts count at 90% under age 59½ and 100% at 59½ or older. Accounts combine. Picture an $800,000 loan backed by $330,000 in brokerage accounts (100%), $300,000 in a 401(k) under 59½ (90%, so $270,000) and $200,000 in savings (100%). That counts $800,000 of usable assets, and the file can qualify on assets alone, subject to underwriting. Credit starts at a 600 score, and loans go up to $4,000,000.
Depletion path. Haircuts are heavier. Cash and CDs count at 100%, securities at 80%, retirement accounts at 70% at any age, and real-estate equity at 60%. Privately held stock is not eligible on either path. Take $1,500,000 in securities (80%, so $1,200,000) plus $300,000 in cash (100%). That is $1,500,000 usable. Divided by 60 months, it produces $25,000 of monthly qualifying income. That income has to carry the housing payment and your other debts through the debt-to-income test. The lender’s own calculation governs.
Both paths document the assets. Dropping income documentation is not the same as dropping documentation.
Which Path Allows Cash-Out on a Primary Residence?
The depletion path is the one with a published cash-out figure. On a principal residence or second home, it allows up to 60% LTV on a cash-out refinance. It allows up to 80% on a purchase or rate-and-term refinance. On the qualifier path, the lender sets cash-out leverage file by file. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
That gap explains why the answers you read online conflict. Pages say cash-out is excluded, allowed, or limited, and they can all be right about different programs. The difference comes from three things: which path the loan runs on, whether the lender permits cash-out proceeds at all, and how the loan is classified.
| Loan type | How qualification works | Cash-out on a primary home |
|---|---|---|
| Asset qualifier | Assets cover the whole loan | Lender-set, not published |
| Asset depletion | Assets become monthly income | Yes, up to 60% LTV |
| Bank statement | Deposits document income | Separate program; terms vary |
| DSCR | Rent covers the payment | No, rentals only |
Cash-out is permitted on some paths and withheld on others, and a primary residence adds consumer-purpose rules. Programs change, and every file is underwritten individually.
How Much Cash Can You Actually Get?
The lower of two ceilings wins. One ceiling is equity: the loan cannot exceed the LTV cap, and on the depletion path that is 60% for a cash-out on a principal residence. The other is repayment capacity: derived income has to carry the new payment through the debt-to-income test. Borrowers often plan around the equity ceiling and forget the second one.
The equity math is simple. Take the home’s appraised value and apply the cap. Subtract the existing mortgage payoff. Subtract closing costs. What remains is the cash. Run it in percentages: a home valued at 100 and carrying a mortgage equal to 40% of value, under a 60% cap, leaves up to 20% of value before costs. Owners with a mortgage near the cap get little or nothing. Owners with a paid-off home get the most room.
Then check the second ceiling. Usable assets over 60 months set the income. A borrower with a smaller portfolio can hit the debt-to-income limit before the equity limit.
Two more rules matter on the depletion path:
- Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance.
- When asset depletion is the only income source, at least $250,000 must be held in liquid assets.
If asset income only supplements documented income, it can run up to a 45% debt-to-income ratio, and the minimum-assets rule is waived. These are floors and ceilings, subject to underwriting. They are not offers.
What Does Qualifying on a Primary Residence Involve?
Occupancy, equity, credit, appraisal, seasoning and asset documentation all get reviewed. The home’s appraisal sets value. The assets are reviewed on their own track, and on these files the asset statements are usually where preventable gaps show up, not the property.
Seasoning is where files slip:
- Qualifier path: 60 days of seasoning and two months of statements for each qualifying account.
- Depletion path: statements at least 120 days old at application, plus the most recent statement within 45 days. Sale-of-business, inheritance and legal-settlement funds are excused from that seasoning.
A large deposit that landed last month will draw questions. Move money before the file goes in, not during review.
Credit on the qualifier path starts at 600. The depletion path follows the lender’s matrix for score and loan amount, so ask for the matrix rather than assuming a 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. A housing event needs 4 years of seasoning on the depletion path.
Some assets do not count on either path. Cryptocurrency, precious metals, collectibles and pledged or borrowed funds are not published as eligible. Custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units are also out on the depletion path. The documented route is converting the asset to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
Think of it as an honest trade. You skip income paperwork. You accept a lower LTV on cash-out than a purchase gets.
Why Doesn’t a DSCR Loan Work for This?
A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. It exists only for non-owner-occupied investment property. Occupancy is signed on an affidavit, and living in the home removes the basis for the loan.
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. Federal Regulation Z exempts credit extended primarily for a business purpose. A mortgage on the home you live in is consumer credit. The lender has to verify the income or assets it relies on, using third-party records. Asset statements meet that standard. A property’s lease does not.
That is the real reason the asset-based paths exist for primary residences. They document something a consumer lender can verify: your balances.
Cash-out proceeds from a DSCR loan on a rental also carry a business-use restriction. They cannot pay off your primary-residence mortgage. So the two products do not overlap. If the equity sits in your home, you use an owner-occupied product. If it sits in a rental, DSCR can reach it.
What About the Edge Cases?
Most edge cases come down to the same question: where do you live? Occupancy follows actual use, not the label on the borrower or the property.
Live in one unit of a 2-4 unit building. DSCR programs generally treat any owner occupancy as ineligible, even when federal rules might treat the credit as business purpose. The program’s own rules decide. This file goes the owner-occupied route.
Moved out and rented the old home. Once you have a lease and have genuinely vacated, the property can be refinanced as an investment property. Cash-out is then a business-purpose question, and DSCR is the natural fit. Lease, vacancy and seasoning rules vary by lender.
Investment property on the depletion path. The asset-based program can also finance investment property, up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. A first-time investor needs a 700 score there. That is a consumer-purpose loan underwritten on assets. It is a different animal from DSCR.
Plans change after closing. Signing an occupancy affidavit and then moving into the property is a misrepresentation problem. Do not do it. If your plans are uncertain, choose the product that matches how you will actually live.
An LLC borrower. Titling a home in an LLC does not convert it to an investment. Occupancy is judged on use.
Who Should Take Cash Out This Way?
The asset-based mortgage program fits borrowers whose balances are large and whose documented income is not. Retirees, business sellers, inheritance and settlement recipients, early-retired professionals and households living off a portfolio are the usual files. The portfolio stays invested. The home becomes the collateral.
| Your situation | Best-fit route | Watch-outs |
|---|---|---|
| Retiree, large portfolio, mortgage-free home | Asset depletion cash-out | 60% cap, asset haircuts |
| Business just sold, cash seasoned | Depletion, seasoning excused | Statement documentation |
| Self-employed, strong deposits | Bank statement cash-out | Different program, deposit review |
| Wants cash to buy a rental | Cash-out first, DSCR purchase second | Two loans, two rule sets |
| Equity sits in an existing rental | DSCR cash-out | Business-use proceeds only |
The two-loan sequence is the common investor play. The owner-occupied loan funds first, and the cash is yours. It can then fund a down payment on a DSCR purchase. Each loan has its own occupancy, documentation and use-of-proceeds rules.
What Are the Alternatives?
A HELOC, a home-equity second, an agency cash-out and a bank-statement cash-out all tap the same equity with different underwriting. Each one decides what it wants to see: income, deposits or assets.
A HELOC is carved out of the ability-to-repay rule in 12 CFR 1026.43, though it has its own rules. Agency and conventional cash-out rules are their own programs’ rules, and they lean on documented income. Bank-statement programs are for borrowers who document income through deposits. None of those is this program, and none of their figures apply here.
For borrowers who do not want to touch the portfolio, asset-based underwriting is often the cleaner structure. Lendmire’s comparison of pledged-asset mortgages, PALs and margin loans on a purchase versus a cash-out lays out the pledged-asset route.
Key Terms Defined
Asset qualifier path: the route where eligible assets, after credit percentages, cover the whole loan and no income is documented.
Asset depletion path: the route where usable assets divided by 60 months become qualifying monthly income.
Cash-out refinance: a new mortgage larger than the payoff, with the difference paid to the borrower.
Usable assets: the balance that counts after each account type’s percentage is applied.
Seasoning: the length of time funds must sit in an account before the lender counts them.
What Are the Risks?
The risks are real. Your home becomes collateral for a larger loan. A portfolio that falls in value shrinks your usable assets, and if you refinance later, the haircuts apply again to the lower balance. On the depletion path, a 60% cap leaves little cash for owners who already carry a large mortgage.
The program also asks you to keep assets in place. Selling the portfolio to reduce the loan is a different decision with different consequences. The strongest files have a plain purpose for the cash and a cushion that does not depend on the market rising.
If the cash would fund a down payment on a rental, size the second loan before taking the first. Do not pull equity from your home on the assumption that a rental will cover everything.
How Does the Process Run?
A broker sorts the path first and the property second. Lendmire arranges asset-based mortgages through select lenders in its network, and consumer mortgage 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. The sequence runs like this:
1. Pick the path. Assets that cover the loan outright point to the qualifier path. Assets that must become income point to depletion.
2. Gather statements. Two months per account for the qualifier path. For depletion, statements 120 days old plus one within 45 days.
3. Confirm the property. Occupancy, appraisal and existing payoff set the equity ceiling.
4. Ask the lender five questions. How does the lender convert each asset? Is cash-out permitted on this path? What is the leverage on a cash-out refinance of a primary residence? What does the lender’s credit matrix require? What loan purposes are allowed?
5. Review the full file. Everything is subject to underwriting, and the lender’s own calculation governs.
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. Reach the team at 828-256-2183 or through the quote form.
Frequently Asked Questions
Can I take cash out of a paid-off home on an asset-based mortgage?
Yes, through the asset depletion path, which allows up to 60% LTV on a cash-out refinance of a principal residence, subject to underwriting. A paid-off home leaves the most room under that cap. The second limit is your derived income, which has to pass the debt-to-income test. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
Do I have to sell my investments to qualify?
No. On both paths the accounts stay in place and are documented with statements. The lender counts a percentage of each balance. On the depletion path, cash-out proceeds never count as qualifying assets.
Can I use the cash to buy a rental?
Once the owner-occupied loan funds, the cash is yours, and it can fund a down payment on a DSCR purchase. The DSCR loan then qualifies primarily on the rental’s income covering its payment, subject to lender guidelines. The two loans have separate occupancy and documentation rules.
Is a DSCR loan ever an option on the home I live in?
No. DSCR loans are for non-owner-occupied investment property and are signed with an occupancy affidavit. If you move out and lease the home, it can later be refinanced as an investment property, subject to lender seasoning and lease rules.
Which assets count toward the loan?
On the qualifier path, brokerage, CDs, money market and savings count at 100%, and retirement accounts at 90% under 59½ and 100% after. On the depletion path, cash and CDs count at 100%, securities at 80%, retirement at 70% and real-estate equity at 60%. Privately held stock, crypto and precious metals are not eligible.
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.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. CFPB, Regulation Z § 1026.3
3. Cornell Legal Information Institute, 12 CFR 1026.43
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 Cash Out a Texas Home on an Asset Depletion Refinance? · How to Buy Before You Sell in Colorado Using an Asset Qualifier Mortgage · Can a Michigan Buyer Get a Mortgage After Paying Cash for a House With No Income?
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.