The Quick Read: The best provider for this loan depends on your situation, because each lender sets its own rules for turning assets into income. Asset depletion converts verified liquid assets into imputed monthly income without selling or pledging them. A broker that shops multiple wholesale lenders matches your assets, property and leverage need to the program that fits.
- Asset depletion is a way to calculate income, not a property type. The assets stay invested.
- Home equity cannot count as depletion assets. The assets must be separate from the property being financed.
- Owner-occupied cash-out on a primary residence reaches up to 75% LTV with a fixed expense ratio. On a second home it reaches up to 75%. Investment-property cash-out tops out around 75%.
- Whether asset depletion is permitted on a cash-out varies by program, so confirm it before you plan around it. Lender guidelines and a full review of property, leverage and credit decide each file.
Key Terms Defined
Jumbo loan: A mortgage above the conforming loan limit set for the county. Limits vary by location, with a baseline for most counties and a higher ceiling in high-cost areas.
Cash-out refinance: A new loan that pays off the old one and releases part of the equity as cash.
Asset depletion: A method that converts verified liquid assets into monthly qualifying income.
Usable assets: The portion of your assets a lender counts after haircuts and deductions for down payment, closing costs and reserves.
Seasoning: The length of time funds must sit in an account before a lender counts them.
What Does “Top Provider” Mean Here?
There is no neutral ranking of asset-depletion jumbo cash-out providers, and this page does not publish one. Lendmire is a mortgage broker, not a lender. It works with a network of wholesale lenders and does not rank or name them.
What separates one program from another is a short list: how it divides the asset pool into income, how it discounts each asset type, whether it allows cash-out on the asset path at all, the LTV ceiling for your occupancy, and what it demands in reserves. The lenders that write this loan depend on your property, credit profile and documentation. That is why a broker comparing programs beats a single-lender search.
How Do Assets Turn Into Qualifying Income?
The lender takes your eligible assets, discounts them by type, subtracts funds already committed, and divides the remainder by a set number of months. The result is imputed monthly income that goes into the debt-to-income test.
The federal ability-to-repay rule does not set the divisor or the haircuts. CFPB’s Regulation Z §1026.43 requires the creditor to verify the income or assets it relies on using third-party records. It also says the creditor verifies only what it actually relied on. Everything else is program design. The rule defines monthly income to include income from assets, which is the hook that makes this method legitimate.
In practice, the process runs like this:
1. Pick the transaction and occupancy. A primary residence, second home and investment property follow different leverage ceilings and disclosure rules.
2. Inventory the assets. Cash, brokerage accounts, and sometimes retirement funds. Statements must come from third-party records.
3. Apply the lender’s haircuts. Cash usually counts fully. Market-exposed accounts are discounted. Retirement accounts are treated by program.
4. Subtract committed funds. Down payment, closing costs and required reserves come out of the pool first.
5. Divide by the program’s period. Longer divisors produce lower income. Shorter ones produce more, and the choice varies by lender.
6. Test the debt-to-income ratio. Some programs add the calculated income to documented income. Others use assets alone.
7. Underwrite the rest of the file. Credit, property and reserves still count. Strong income math does not override a weak file elsewhere.
Which Assets Count, and Which Don’t?
Cash, brokerage holdings and, in many programs, retirement balances count, each at a discount that differs by lender. Home equity never counts. The rule’s repayment-ability factor looks at assets other than the dwelling that secures the loan.
Cash-out proceeds are the other trap. Programs differ on whether the money you pull out counts as an asset or as reserves, and many do not count it. A file that depends on its own proceeds to qualify is a file that stalls. Plan the qualifying pool from assets you already hold, and treat the proceeds as bonus liquidity.
Seasoning matters too. Many programs want funds to sit for a stretch and want statements to be recent. Moving money between accounts right before applying creates paper-trail questions.
Does Asset Depletion Actually Work for Cash-Out?
It depends on the program. Some programs allow cash-out on one asset path and not another, and some bar asset depletion from cash-out entirely. “Asset depletion” does not imply “cash-out allowed.”
Across the wholesale network, the leverage picture looks like this, subject to lender guidelines:
| Occupancy | Transaction | Typical ceiling |
|---|---|---|
| Primary residence | Cash-out, fixed expense ratio | Up to 75% LTV |
| Primary residence | Cash-out, accountant-prepared ratio | Up to 75% LTV |
| Second home | Cash-out | Up to 75% LTV |
| Investment property | Cash-out | Around 75% LTV |
| Primary residence | Asset-depletion alternative | Up to 80% LTV |
The 75% accountant-prepared figure is the same ceiling as the fixed expense ratio option. The asset-depletion alternative on a primary residence runs to about 80%. Purchase and rate-term loans on a primary residence can reach higher through select lenders, up to 85% LTV, but that is not the cash-out number. Loan sizes in this lane run roughly $125,000 to $3,500,000, with reserves commonly around six months of the housing payment.
Two Asset-Based Paths, Compared
Asset-based qualification comes in two shapes. One converts assets into income. The other treats assets as proof you can cover the loan. Programs mix and match, so read the sheet.
| Factor | Assets converted to income | Assets as coverage |
|---|---|---|
| How assets are used | Divided into monthly income | Counted against the loan balance |
| Income documented | Imputed, may add to other income | None required beyond assets |
| Best fit | Large pool, modest taxable income | Very large pool, minimal income |
A Worked Example
Say a retired investor holds a large brokerage account and a cash reserve, with a rental property and little taxable income. The lender discounts the brokerage balance, adds the cash, and subtracts the funds needed for closing and reserves. What remains is divided across the program’s period to produce imputed income. If that income clears the debt-to-income test with room to spare, the asset side works. These inputs are modeled assumptions, not market data.
Then the rest of the file gets its turn. Credit, the property, the LTV on cash-out and the reserves all get reviewed. A lender can decline on any of them even when the income side clears.
Where the General Rule Breaks
Occupancy changes the disclosure regime. An owner-occupied cash-out, whether a primary residence or second home, is a consumer mortgage, and TRID applies. A bank-statement or asset-based loan on a non-owner-occupied rental, including a short-term rental, is business-purpose and exempt from TRID. Which one applies depends on the property, and the two should never be mixed in one file.
Business-purpose loans sit under a different rule. Regulation Z §1026.3 exempts credit extended primarily for a business purpose, and treats non-owner-occupied rental property as business credit. A lender may still underwrite to its own standards, so expect asset verification either way.
Entity borrowers. Credit to a borrower that is not a natural person is generally exempt from Regulation Z, per America’s Credit Unions, subject to program terms.
Jumbo means no agency path. Loans above the conforming limit fall outside agency eligibility, so jumbo lenders write their own asset rules. That is why divisors, haircuts and cash-out terms differ so much from one program to the next.
Asset Depletion vs. Bank Statements vs. DSCR
| Path | What it reads | Fits |
|---|---|---|
| Asset depletion | Borrower’s balance sheet | Large portfolio, low taxable income |
| Bank statements | 12 months of deposits | Self-employed with strong cash flow |
| DSCR | Property rent vs. its payment | Rental investors on investment properties |
Bank-statement loans qualify on documented income under the applicable program, using 12 months of business or personal deposits averaged with lender-specific expense factors. They do not convert a portfolio into income. DSCR is a separate lane that reads the lease, not the borrower. Lendmire’s complete DSCR loans guide covers that path. Investors weighing options can also read Lendmire’s piece Top Asset-Based Cash-Out Refinance Providers With Non-Traditional Income.
How to Vet a Provider Through a Broker
Ask these questions of any program before a file goes in:
- What period does the program divide the asset pool by?
- How are retirement and market-exposed accounts discounted?
- Is cash-out allowed on the asset path, or only on another path?
- What is the LTV ceiling for my occupancy and loan size?
- Do cash-out proceeds count toward assets or reserves?
- How old can statements be, and how long must funds season?
- What reserves does the program expect?
A broker runs those questions across several wholesale lenders at once. The match depends on property type, credit, leverage need and documentation. The same borrower can look strong at one lender and weak at another, based on the divisor alone.
Who Fits, and Who Doesn’t
This loan suits investors with large liquid portfolios and low taxable income: retirees, people who sold a business, and owners whose returns show heavy depreciation. A cash-out frees equity without selling securities. The portfolio stays invested.
It fits poorly when the pool is thin after deductions, when the file leans on cash-out proceeds to qualify, or when the property is a straight rental that covers its own payment. Rental investors in that last group often move to DSCR instead.
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.
What to Prepare
- Recent statements for every account you want counted, from third-party records.
- A clear paper trail for any large deposit or transfer.
- Documentation of the property, its occupancy and its use.
- Credit and entity documents, if the borrower is an entity, subject to lender program eligibility.
- A plan for reserves that does not rely on the cash-out itself.
Frequently Asked Questions
Can the cash I take out count toward my qualifying assets?
Generally not. Programs differ, but many exclude proceeds from eligible assets. Build the qualifying pool from funds you already hold, and treat proceeds as extra liquidity.
Do agency asset-depletion rules apply to a jumbo cash-out?
No. Loans above the conforming limit sit outside the agency framework, so jumbo lenders set their own divisors, haircuts and cash-out terms. Programs vary, and that variation is the reason to compare several.
Can retirees and self-employed borrowers use asset depletion?
Yes, in many programs. Retirees with large balances and low taxable income are a common fit. Self-employed borrowers can also compare bank-statement qualification, which reads 12 months of deposits instead of a portfolio.
Is asset depletion the same as DSCR?
No. Asset depletion reads the borrower’s balance sheet. DSCR reads the property’s rent against its payment. Both are non-QM, and an investor can choose between them depending on the file.
What reserves should I expect?
Reserves commonly run around six months of the housing payment, subject to lender guidelines and loan size. Reserves come out of the asset pool before income is calculated.
What stalls these files?
Thin pools after deductions, cash-out terms that exclude the asset path, stale statements and unexplained transfers. Choosing a program that fits the file before you apply addresses each of these directly.
If you hold a large portfolio and want to see how the numbers work, Lendmire can help you compare asset-based and bank statement options based on your assets, the property, credit profile, leverage and your goals. Qualification is on documented income under the applicable program, subject to lender guidelines. This is not a commitment to lend. Lendmire’s consumer mortgage licensing covers 16 states.
For how equity extraction works on an investment property, see Lendmire’s guide to cash-out refinance on an investment property.
For current guidelines and terms, see Lendmire’s self-employed mortgage programs page.
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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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
This article is part of Lendmire’s self-employed mortgage guides — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How Much Cash Comes Out of a Bank Statement Cash-Out Refinance Right After Buying? · Bank Statement Cash-Out Refinance vs Full-Doc Refinance After a Title Change · Super Jumbo Bank Statement Cash-Out Refinance vs Asset-Based Cash-Out on 30-Year Fixed
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.