The Quick Read: The right provider for your expansion depends on your assets, your property, your credit, and how much leverage you need, so this page explains the programs these lenders run instead of ranking companies. Lendmire is a mortgage broker that shops a network of wholesale lenders and matches your file to a program. On this kind of loan, cash-out is usually sized on the asset depletion path, where your eligible assets become a monthly qualifying income. Everything below is subject to underwriting and is not a commitment to lend.
- Leverage on a cash-out tops out at 60% loan-to-value on a principal residence, second home, or investment property, through select programs.
- Your documented assets, not pay stubs or tax returns, carry the file. You still provide statements, and the file is fully underwritten.
- Proceeds you pull out never count toward qualifying. The assets you already own have to do that job.
- Founders holding company shares should plan around a sale or buyout, since closely held stock does not count as an asset.
- Expect the lender to ask what the money is for. A written use of proceeds matters on an expansion loan.
Which Path Fits You?
Start by deciding whether your assets cover the loan outright or whether they have to become income. Those are two separate paths, and you are qualified on one at a time. The asset-based mortgage programs Lendmire places keep the two paths separate, and so does this article.
The asset qualifier path asks one question. After the credit percentages below, do your eligible assets equal or exceed the entire loan amount? If they do, no employment or income is documented. Loans run up to $4,000,000 on this path, and the credit floor is a 600 score, subject to underwriting. Leverage reaches 80% on a purchase and 75% on a refinance of a principal residence or second home. Whether cash-out proceeds are allowed on this path, and at what leverage, is set by the lender and is not published. Ask before you count on it.
The asset depletion path turns assets into income. The lender takes your usable assets, divides them by 60 months, and treats the result as monthly qualifying income. That income has to carry the housing payment and your other debts through the debt-to-income test. Loans run from $125,000 to $3,500,000 on this path.
This is where a cash-out refinance for an expansion usually lives. On the depletion path, leverage is 80% on a purchase or rate-and-term refinance of a principal residence or second home. On a cash-out refinance of that same property, it is 60%. Investment property is capped at 65% on a purchase or rate-and-term refinance and 60% on a cash-out refinance. Those are ceilings, not offers, and they apply through select programs.
The reader this fits is cash-heavy and income-light. Think of a founder who sold a company, a retiree living on a portfolio, someone holding an inheritance or settlement, or an early-retired professional. Balances are large, documented income is small, and a standard income-based mortgage reads the file backward.
How Does Underwriting Treat a Cash-Out on the Depletion Path?
The lender sizes the loan by testing leverage, income, and assets together, and the tightest test sets the limit. Here is the sequence a depletion-path cash-out file follows, step by step.
1. Assets are inventoried. You list every account you want counted. The lender applies the percentages for each asset type (shown in the next section) and totals what is usable.
2. Statements are checked for age. Statements must cover at least 120 days at application, which shows the funds have been in place, and the most recent statement must fall within 45 days. Funds from the sale of a business, an inheritance, or a legal settlement are excused from that seasoning.
3. Minimum assets are tested. Qualified assets must reach at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are your only income source, you also need at least $250,000 in liquid assets.
4. Usable assets become income. The total divides by 60 months. That monthly figure is your qualifying income.
5. The payment runs through debt-to-income. The new housing payment and your other debts must fit the program’s debt-to-income test. A bigger cash-out means a bigger payment, so the loan limits itself.
6. Credit is reviewed. The depletion path follows the lender’s score and loan-amount matrix. A first-time investor on this path needs a 700 score. Housing history is 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible, and a housing event needs four years of seasoning.
7. The property is valued. An appraisal sets the value, and the leverage cap applies to that value.
Net cash to you is the new loan minus the payoff of the old one, closing costs, and prepaids. A cash-out does not guarantee a large check, especially when the existing balance is large. Asset-derived income can also supplement documented income up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived.
What Counts as an Asset, and at What Percentage?
Each asset counts for a share of its balance, and the two paths use different tables. Never blend them. Percentages here are the share that counts, and the rest is excluded.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Brokerage accounts | 100% | Securities: 80% |
| Cash, savings, money market | 100% | Cash accounts: 100% |
| Certificates of deposit | 100% | 100% |
| Retirement accounts | 90% under 59½, 100% after | 70% at any age |
| Real-estate equity | Not listed | 60% |
On the qualifier path, accounts combine. On the depletion path, several categories are not eligible: 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. Privately held stock is excluded as well.
Seasoning differs too. The qualifier path wants 60 days of seasoning and two months of statements for each qualifying account. Reserves are not required at or below 75% loan-to-value, and above that the lender sets them. The depletion path publishes no reserve months.
Cryptocurrency, precious metals, collectibles, pledged or borrowed funds, and business accounts beyond your ownership share are not published as eligible on either path. The documented route is to convert them into a seasoned cash balance in a regulated account, with the source reviewed by the lender.
Can the Proceeds Really Fund a Business?
Using cash-out proceeds to grow a business is a normal use, and the lender will want it described in writing. The federal rule on purpose makes the point directly. The CFPB’s commentary on business-purpose credit lists a loan to expand a business as business-purpose credit, even when a residence secures it. The same text says purpose is judged case by case, using factors like how closely the use relates to your occupation and how involved you are personally.
That matters for a practical reason. A law firm analysis from Hunton stresses that business purpose does not mean exempt from compliance, and that misclassifying a loan has consequences. So the lender decides how to classify your file, not you. The asset-based mortgage described here is a consumer mortgage, and consumer-mortgage disclosures apply to it. Expect a statement of purpose, and keep invoices and payroll records for what you spend.
Tax treatment can depend on how the funds are used and how the property is held; borrowers should keep clear records and speak with a qualified tax professional before relying on any deduction.
Where the General Rule Breaks
The rules above bend in a few named places, and each one changes your plan.
Private company stock. A founder’s route is documented liquid assets: seasoned proceeds from a sale or conversion, cash, public securities, and retirement accounts at their percentages. On the depletion path, sale-of-business proceeds are excused from the 120-day statement seasoning, which helps a founder who just exited.
Cash-out proceeds as qualifying assets. They never count. You cannot pull cash out and then use that cash to qualify for the loan that produced it.
Starting from scratch. An expansion of an existing business is a cleaner story than launching a new one. The case-by-case purpose factors from the CFPB commentary apply either way, and the lender’s review governs.
Investment property. Investment property is financed only on the depletion path, and there the loan is business-purpose, unlike the consumer-purpose loans on a principal residence or second home. Leverage is lower: 60% on a cash-out refinance. Business-purpose rental financing otherwise belongs to a different product, DSCR, which qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.
Occupancy. Whether the property is a principal residence, second home, or investment property sets the leverage table. Do not apply a principal-residence figure to a rental.
Retirement accounts. The qualifier path counts them at 90% under age 59½ and 100% afterward. The depletion path counts them at 70% at any age. The same account can look very different on each path.
Small asset bases. The depletion minimums can end the conversation. If your qualified assets fall short of the lesser of $1,000,000 or 1.25 times the loan, and you have no documented income to supplement, the file does not fit this path.
How the Routes Compare for Funding an Expansion
Cash-out on an asset-based mortgage is one route among several. The table describes how each route works in general, and each program’s own rules govern its details.
| Route | Reviewed on | Collateral | Tradeoff |
|---|---|---|---|
| Asset-based cash-out | Assets, converted to income | Your home or property | Leverage capped at 60% |
| Business line or term loan | Business financials | Business assets, often a guarantee | Needs business records |
| Home equity line | Income and credit | Your home | Variable draw terms |
| Selling an asset | Not applicable | None | Ends your ownership |
The asset-based route suits an owner whose balance sheet is strong and whose paper income is thin. It puts your home or property behind the business, so the risk is personal. Size the draw to what the expansion can realistically repay. Test whether the business return beats the added carrying cost of a larger payment.
How to Judge a Provider (Without a Ranking)
The lenders that write this program differ, and the right match depends on your property, credit profile, leverage need, and documentation. A single ranked list would not tell you that. Lendmire is a broker, not a lender. It works with a network of wholesale lenders, shops your scenario across their programs, and matches the file to the one that fits. 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.
When you compare any provider, ask these questions:
- What are the cash-out leverage limits for my property type and occupancy?
- Does my asset mix count, and at what percentage?
- How old must my statements be, and what seasoning exemptions apply?
- What does the debt-to-income test look like for my derived income?
- How does the lender treat first-time investors, housing events, and late payments?
- What written use-of-proceeds statement do I need to provide?
A broker earns its place when your assets are unusual. A founder with a sale just completed, a retiree with mostly retirement accounts, and a household holding securities in several brokerages each land on different programs, because the lenders weigh the same assets differently.
A Worked Example
Run the numbers on a household with $1,500,000 in securities and $300,000 in cash. These figures are illustrative, and the lender’s own calculation governs. Securities count at 80%, which is $1,200,000. Cash counts at 100%, which is $300,000. Together that is $1,500,000 of usable assets.
Divide by 60 months and you get $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test. A larger cash-out raises the payment and uses up more of that income, which is why a high balance sheet does not translate into an unlimited loan. The minimum-assets test is the lesser of $1,000,000 or 1.25 times the loan balance, so these $1,500,000 of usable assets clear it for any loan balance, subject to underwriting.
Compare that with the qualifier path, where assets must cover the whole loan. An $800,000 loan backed by $330,000 in brokerage accounts (100%), $300,000 in a 401(k) under age 59½ (90%, so $270,000), and $200,000 in savings (100%) counts $800,000 of usable assets. That is reviewed on assets alone, with no income documented. It does not address cash-out, which that path leaves to the lender.
Key Terms Defined
Asset qualifier path: the route where your eligible assets must equal or exceed the full loan amount, with no employment or income documented.
Asset depletion path: the route where usable assets are divided by 60 months into a qualifying income that runs through the debt-to-income test.
Cash-out refinance: a new, larger loan that pays off the old one and hands you the difference in cash.
Seasoning: the waiting period an asset or account must sit documented before the lender counts it.
Debt-to-income (DTI): your monthly debts, including the new housing payment, compared with your monthly qualifying income.
Use of proceeds: the written statement of what you will do with the cash, which the lender reviews.
Frequently Asked Questions
Can I use an asset-based cash-out refinance to fund a business expansion?
Yes, on programs where cash-out is offered, and the lender will want the purpose stated in writing. Cash-out generally runs on the asset depletion path, subject to underwriting. Keep records of how the money is spent, because the lender classifies the file.
How much can I take out?
On the asset depletion path, leverage is capped at 60% loan-to-value on a cash-out refinance of a principal residence, second home, or investment property. The final amount is limited further by your debt-to-income test and the minimum-assets rule. On the asset qualifier path, cash-out terms are set by the lender and are not published.
Does privately held stock in my company count as an asset?
No. If you sell or convert it, the seasoned proceeds sit in a regulated account and can then count at the percentage for that account type. Sale-of-business funds are excused from the depletion path’s statement seasoning.
Do I have to show tax returns or pay stubs?
No traditional personal-income documentation, pay stubs, or employment verification are required to qualify on assets. The file is still fully underwritten. You document the assets with statements, and the lender reviews your credit, the property, and the use of proceeds.
Can cryptocurrency or precious metals count toward the loan?
They are not published as eligible on either path. The documented route is converting them into a seasoned cash balance in a regulated account, with the source reviewed by the lender.
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. Reach the team at 828-256-2183 or request a quote. Programs change, and every file is underwritten individually through select lenders.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages for self-employed and high-net-worth borrowers are arranged through wholesale lenders on primary residences, second homes and investment properties; every file is underwritten by the lender under its program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. Hunton, Beware Business Purpose: Regulatory Implications of Investment Mortgage Loans
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Best Asset-Based Cash-Out Refinance Program to Fund Spec Home Construction · How to Qualify and Apply for an Asset-Based Cash-Out Refinance as a Retiree · Asset-Based Cash-Out Refinance Requirements After Selling a Business
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.