The Quick Read: Yes, when the loan fits who actually lives there: your parent borrows on their own assets for a principal residence, or you buy it as an investment property on the asset depletion path and describe the occupancy truthfully, subject to underwriting.
- Asset-based mortgages qualify the borrower on assets, not paychecks. The assets are still fully documented.
- Principal residence and second home are the standard occupancy boxes. A home you buy for a parent to live in fits neither one cleanly when you are the borrower.
- Investment property is available only on the asset depletion path, at lower leverage than a primary residence.
- A business-purpose DSCR loan is the wrong tool if your parent will live in the home.
- Georgia changes none of the program figures. It changes the deed, title and estate-planning questions you should bring to a Georgia attorney.
Start With Occupancy, Not Assets
The first question on any home loan is who lives in the home. The answer sets the loan type, the leverage and the paperwork, and it comes before the asset math.
An asset-based mortgage is a consumer mortgage. It covers principal residences and second homes on both paths. Investment property is allowed only on the asset depletion path. Across the wholesale network, most files break at the occupancy line, not at the asset line. Borrowers have the money. The trouble starts when the home is bought for someone else to live in.
Say your parent will live in the home full time and you are the borrower. You will not live there, so it is not your principal residence. A second home generally means you use the property yourself. The remaining box is investment property. That box is real, but it brings lower leverage and a closer look at what your parent pays, if anything.
Lendmire is a broker. It arranges these loans through select lenders in its network. Each lender decides how to classify the occupancy, and every file is underwritten individually. Lendmire is licensed for consumer mortgage lending in 16 states, and Georgia is one of them.
The Two Paths in Plain Words
The program has two paths. A borrower is reviewed on one path at a time, never both.
Asset qualifier path. Your eligible assets, after the credit percentages below, must equal or exceed the entire loan amount. No employment or income is documented. Typical leverage runs up to 80% on a purchase and 75% on a refinance, on a principal residence or second home. Loans run up to $4,000,000. The credit floor is 600, through select programs.
Asset depletion path. Eligible assets, after haircuts, are divided by 60 months. The result is a monthly qualifying income. That income must carry the full housing payment and other debts through the debt-to-income test. Loans run from $125,000 to $3,500,000, subject to underwriting. The lender’s credit matrix sets the score requirement. A first-time investor on this path needs 700.
Here is how each counts, using the illustrative shapes the program uses.
On the qualifier path, picture an $800,000 loan. The borrower holds $330,000 in brokerage accounts, which count at 100%. They hold $300,000 in a 401(k) while under age 59½, which counts at 90%, or $270,000. They also hold $200,000 in savings, which counts at 100%. That totals $800,000 of usable assets, so the loan is reviewed on assets alone.
On the depletion path, say $1,500,000 sits in securities, counting at 80% for $1,200,000. Another $300,000 sits in cash, counting at 100%. Usable assets are $1,500,000. Divided by 60 months, that is $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts. The lender’s own calculation governs, and these are examples only.
For more on how trust-held accounts fit into this math, see Lendmire’s piece How to Use Trust Assets to Qualify on an Asset Depletion Mortgage.
Which Family Setup Are You In?
The answer shifts with whose assets qualify and who lives in the home. Most Georgia families fall into one of three setups.
| Setup | Who borrows | Who lives there | Typical fit |
|---|---|---|---|
| Parent buys for themselves | Parent, on parent’s assets | Parent | Principal residence |
| Child buys, parent lives there | Child, on child’s assets | Parent | Investment property, depletion path only |
| Child lives there and parent joins | Child, parent in the household | Both | Depends on the lender |
Setup one: the parent is the borrower. This is the cleanest fit. A retiree with brokerage accounts, CDs or a large savings balance can qualify on their own assets. The home is their principal residence. The qualifier path may cover the whole loan outright. Your help as an adult child can take the form of a documented gift toward the purchase, but a gift is a separate question from who qualifies.
Setup two: you are the borrower and your parent lives there. This is the hard one. You may hold the assets and the credit, yet your parent holds the keys. The depletion path allows investment property at up to 65% on a purchase and up to 60% on a cash-out. Expect the lender to ask who occupies the home, whether rent is paid, and how the arrangement is documented. Describing the home as your second home when you will not use it is a misstatement. Don’t do it.
Setup three: shared household. If a parent moves in with you, the home is your residence. That can be a principal residence for you. It is a different file from setup two, and the lender will want the facts stated as they are.
Why Not Use a DSCR Loan for This?
DSCR loans are built for rentals. They 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. Programs bar the borrower and family members from living in the property.
Coverage is monthly rent divided by the full monthly payment, including taxes, insurance and any HOA dues. A parent who lives there rent-free produces no rent, so there is no ratio to test. A parent who pays a discounted rent drags the counted rent down, since the lower of the signed lease and market rent is what usually counts. That is a program convention across the network, not a law.
The business-purpose label also has to be true. Federal rules exempt credit extended primarily for a business purpose from some consumer protections, and the CFPB’s Regulation Z sets that exemption. The label has to match the real purpose of the loan. A home bought as family housing reads as personal use, whatever the file says. That is a reasoned read of the rule, not a regulator’s statement about parents.
A parent in a truly separate household who pays market rent from their own funds, with a signed lease and a bank-record trail, can sometimes work on a DSCR file. That works only on programs that allow related-party tenants, and some exclude them entirely. It is a rental decision, not a way to house a parent. Lendmire’s complete DSCR loans guide covers how those programs treat the rent.
What Counts as an Asset, and What Doesn’t
The credit percentages differ by path. Never blend the two tables.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Brokerage accounts | 100% | Securities 80% |
| Cash, savings, money market | 100% | Cash accounts 100% |
| Certificates of deposit | 100% | 100% |
| 401(k) and IRA | 90% under 59½, 100% after | 70% at any age |
| Private stock | Not listed | 75% |
| Real-estate equity | Not listed | 60% |
Accounts combine. On the depletion path, custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units are not eligible. Funds from non-regulated financial companies are out too.
Cryptocurrency, precious metals, collectibles, borrowed funds and pledged funds 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. Cash-out proceeds from another property never count as qualifying assets on the depletion path.
Your parent’s money is its own question. If your parent’s funds help you buy, the lender will want to know whether they are a gift or your parent’s own qualifying assets. Those are different files with different paperwork. A gift letter and the parent’s statements belong in the file early.
Seasoning and Statements
Statements are where files stall. Assets are documented on both paths. “No income documentation” never means “no documentation.”
On the qualifier path, expect 60 days of seasoning and two months of statements for each qualifying account. On the depletion path, expect statements at least 120 days old at application, 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.
Money moved into your account from a parent right before application is the usual snag. A large new deposit with no paper trail triggers a source review. Move it early, document it, and keep the gift letter with the statements.
Depletion has its own floors. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. They must never be below $250,000 liquid when asset depletion is the only income source. If the derived income only supplements documented income, it can run up to a 45% debt-to-income ratio, and the minimum-assets rule is waived.
On the qualifier path, reserves are not required at or below 75% loan-to-value. Above that, the lender sets them.
Can Your Parent Co-Borrow Instead?
Sometimes, but the rules belong to other programs, not this one. Take FHA as the example. HUD’s archived reference guide describes a non-occupant co-borrower, a person on the loan who does not live in the home. That setup fits when your parent is the occupant and a relative helps them qualify. The same guidance says a parent selling to a child cannot also be a co-borrower unless the loan-to-value is 75% or less. That is an FHA rule, and the guide is archived, so confirm current terms with an FHA lender.
Fannie Mae also has a family-occupancy exception that can treat a home bought for an elderly parent or a disabled adult child as a primary residence. It applies when that person cannot qualify alone. It is an agency rule, not a rule of the asset-based program, and its terms sit with those lenders.
None of that changes how the asset-based program works. If a non-occupant co-borrower or a family-occupancy exception fits your family, those are consumer routes with their own rules.
Compare Before You Choose
| Route | Who occupies | Reviewed on | Watch-out |
|---|---|---|---|
| Asset qualifier, parent borrows | Parent | Parent’s assets | Parent’s assets must cover the loan |
| Asset depletion, child borrows | Parent | Child’s assets as income | Investment-property leverage, truthful occupancy |
| FHA with non-occupant co-borrower | Parent | Parent plus relative | Parent-seller limits, other program’s rules |
| DSCR rental | Tenant | Property rent | Parent living there breaks it |
Weigh a few questions before picking a row. Whose assets are larger and better documented? Who needs the home as a principal residence for their own use? Will anyone pay rent, and from whose funds? Is it a family housing arrangement or an actual rental?
Honestly, the cleanest file is usually the one where the person who lives in the home is the person on the loan. If your parent has the assets, start there. If your parent has income-light, asset-heavy finances and you want to help, the qualifier path on their assets is often the simplest route to review.
Risks and Trade-offs
Asset-based loans cost more to document than to describe. Assets are verified in detail. Retirement accounts take a haircut on the depletion path. Pulling securities or retirement funds for a down payment can shrink the very balances the loan counts.
Markets move after closing. A portfolio that is the sole source of qualifying income can fall in value. The loan balance does not fall with it. Plan for that cushion before you commit.
Joint ownership adds its own risk. If your name and your parent’s name are both on the deed or the loan, each person’s finances become tied to the other’s. Title and deed choices are worth a Georgia real estate attorney, and so are estate, gift and eldercare planning questions. Tax treatment varies; consult a qualified professional.
Labeling a home an investment property, or a second home, when the real plan is to house a parent invites a misrepresentation problem. Say it plainly and let the lender classify it.
A Georgia Walk-Through
Picture a retired couple in metro Atlanta whose adult daughter wants to buy them a home near her. The daughter holds a large brokerage account. The parents hold their own CDs and savings but little reportable income.
The first path to review is the parents as borrowers on the qualifier path. Their CDs and savings count at 100%, and a gift from the daughter toward the purchase is documented separately. The home is their principal residence.
If the daughter wants to be the borrower instead, she would review the depletion path as an investment-property purchase, since she will not live there. That means 65% leverage on a purchase, a first-time investor credit requirement of 700 if it applies to her, and a conversation with the lender about how her parents’ occupancy is documented. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
Georgia state facts, such as local prices or tax levels, are context only. They do not change the program parameters. Georgia-specific title and deed questions go to an attorney.
Key Terms Defined
Asset qualifier path: The path where eligible assets must cover the entire loan and no income is documented.
Asset depletion path: The path that divides usable assets by 60 months to create a qualifying monthly income.
Haircut: The percentage of an asset’s balance that does not count toward qualifying.
Non-occupant co-borrower: A person on the loan who does not live in the home.
Seasoning: The length of time funds must sit in an account, supported by statements.
Related-party tenant: A renter who is a family member of the borrower, which some investor programs exclude.
Practical Next Steps
1. List who will live in the home and who will be on the loan. Decide that before anything else.
2. Gather two months of statements for each qualifying account. Pull 120-day-old statements too if the depletion path is in play.
3. Document any parent gift with a letter and a clean transfer trail.
4. Check which assets are eligible and what percentage each counts for on the path you want.
5. Take the deed and title structure to a Georgia attorney before contract.
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 mortgage quote page.
Frequently Asked Questions
Can I buy a house for my parents with an asset-based mortgage if I won’t live in it?
Possibly, but not as a principal residence or second home for you. The depletion path allows investment property at up to 65% on a purchase, subject to underwriting. Expect questions about who lives there and whether rent is paid. The lender decides how to classify it.
Can my parent be the borrower on an asset-based loan?
Yes, if the parent’s own assets qualify. On the qualifier path, eligible assets must cover the entire loan, and the credit floor is 600 through select programs. The depletion path uses the lender’s credit matrix instead. Your parent’s home is their principal residence, which is the most direct fit.
Does a DSCR loan work if my parent lives in the home?
Generally no. DSCR loans are business-purpose, non-owner-occupied investment loans, and programs bar family occupants. A parent in a separate household paying documented market rent can work only on programs that allow related-party tenants.
Do gifted funds from my parent count as my assets?
A gift is its own item, not a qualifying asset of yours by default. The lender wants a gift letter and a documented transfer. Your parent’s own funds can count as their assets if they are the borrower. Other deposits are reviewed for source.
Does buying in Georgia change the program?
No. Leverage, asset credit and seasoning are the same in every state where the program is available. Georgia is among the 16 states where Lendmire offers consumer lending. Deed and title questions are Georgia-specific and belong with an attorney.
Lendmire’s asset-based mortgage in Georgia page presents the program for Georgia borrowers.
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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References
1. CFPB Regulation Z, section 1026.3
2. HUD Archives, Home Ownership Center Reference 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: Asset-Based Mortgage vs Home Equity Investment for Retirees Who Need Cash · How to Buy Before You Sell in Washington Using an Asset Qualifier Mortgage · Can Two Montana Retirees Buy a Home Together on an Asset Qualifier Mortgage?
Guides: Asset-Based Mortgage in Georgia
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.