The Quick Read: An asset depletion jumbo loan is reviewed for a borrower by converting eligible liquid assets into monthly qualifying income, so a large mortgage can be sized on a portfolio instead of traditional personal-income documentation or pay stubs, while nothing is sold, withdrawn, or pledged and the lender still reviews credit, property, and reserves.
- It is an income-calculation method, not a separate kind of property loan.
- Eligible liquid assets are netted for cash to close and reserves, then divided by 36, 60, or 84 months, depending on the program path.
- Asset paths are for primary and second homes. Investment property usually moves to rental-cash-flow qualification.
- Through select wholesale programs, leverage on this path tops out at 80%, subject to full underwriting.
- Above $4,000,000, every file is reviewed case by case before submission.
Why Asset-Rich Borrowers Get Turned Away
A borrower can own a seven-figure portfolio and still fail a standard income review. The reason is simple. Underwriters read taxable income, and taxable income is often small for retirees, founders who reinvest profits, and executives paid mostly in stock.
Picture a retired surgeon with a large brokerage account and a modest pension. On paper, her reported income looks thin next to a large mortgage. Her wealth is real, but it sits in a place a salary-based formula cannot see.
Asset depletion fixes that mismatch. The lender treats the portfolio as the repayment source and measures it the way it would measure a paycheck. It is one of several ways Lendmire, a broker working with a wholesale lender network, can match a high-balance file to a qualifying path. The broader landscape is covered in the complete DSCR loans guide.
Key Terms Defined
Asset depletion: A qualifying method that turns eligible assets into imputed monthly income by dividing them over a set number of months.
Jumbo: A mortgage larger than the agency conforming limit, which is why it follows lender-set guidelines instead of agency ones.
Divisor: The number of months the usable assets are spread across. A smaller divisor produces more income.
Haircut: The percentage by which a lender discounts an account type, such as a retirement balance, before counting it.
Imputed income: Income the lender calculates from assets. The borrower never has to draw it.
Assets-only: A path that is reviewed on liquidity equal to the loan plus costs and skips the debt-to-income ratio entirely.
How Underwriting Treats It, Step by Step
Underwriting runs in a fixed order. Each step changes the number that comes next.
1. Choose the assets. Eligible assets are liquid or near-liquid: checking, savings, money market, brokerage, and retirement accounts. Across our wholesale network, business funds, gifts, most trusts, unvested stock, and cryptocurrency do not count. A revocable living trust is the trust exception.
2. Apply haircuts. Retirement accounts count at 70%, or 80% for a borrower age 59½ or older, because withdrawals can carry costs. Cash and securities are treated more favorably than retirement money.
3. Net out the deal. Down payment, closing costs, and reserves come out of the pool first. The same dollars cannot buy the house and also generate income.
4. Divide by the depletion period. This step does the most to set the loan size, so the next section covers it separately.
5. Add other income. Pensions, Social Security, and documented distributions can sit on top of the imputed figure.
6. Run the debt-to-income ratio. The imputed income is measured against the full housing obligation and other debts. Most programs we place files with cap the final ratio, with the asset income counted, at 50%.
7. Verify. Lenders want consecutive recent statements showing ownership and access. For owner-occupied consumer loans, federal rules require the lender to verify the assets it relies on with third-party records, so self-reported balances never carry a file.
The assets stay where they are. Depletion is a qualifying convention, not a withdrawal plan.
The Divisor Decides the Loan Size
Two programs can read the same portfolio and produce very different incomes. The only difference is how many months each one divides by.
| Path | Divisor | Where it applies |
|---|---|---|
| Asset allowance, supplemental | 36 months | DTI before asset income at or below 60% |
| Asset allowance, supplemental | 60 months | DTI before asset income above 60% |
| Asset allowance, standalone | 84 months | Also any loan above $3,500,000 |
| Assets-only | None | No DTI; liquidity must equal loan plus costs |
These are select-program figures, subject to full underwriting. The 60% test only picks the divisor. Once the asset income is counted, the qualifying ratio must still fit the 50% ceiling. Look at what the divisor does to the same pool of assets. Income at 84 months is only about 43% of the income at 36 months. At 60 months it is about 60%.
That gap explains why a borrower with other income, such as a pension, often sizes larger than one relying on the portfolio alone. The supplemental path divides over fewer months, but it needs real documented income alongside the assets.
The asset-allowance path covers primary and second homes only, with leverage capped at 80%. In practice, a borrower who has already netted cash to close and reserves out of the pool should read the divisor as the lever and the remaining pool as the fuel.
What the Assets-Only Path Does Differently
Assets-only drops the debt-to-income calculation. Instead, the borrower’s U.S. liquid assets must equal the loan amount plus closing costs. If the borrower owns other residential property that loses money, sixty months of that net loss are added on top.
That is a high bar, and it is meant to be. A borrower who qualifies this way is showing the lender the ability to repay the entire balance from liquidity. It suits someone with a very large portfolio and almost no ordinary income, and it is the wrong tool for someone who is merely comfortable.
Size and Leverage on a Jumbo
A portfolio non-QM program carries files to $6,000,000. A bank portfolio program takes twelve-month-statement files to $30,000,000, and its own ladder begins above $4,000,000 and overlaps the first program to $6,000,000.
Leverage steps down as the loan grows. On a primary-residence purchase, typical ceilings are:
- 90% to $1,000,000
- 85% to $2,000,000
- 80% to $3,000,000
- 75% to $4,000,000 for the strongest credit tier
Above $4,000,000, the figures are reviewed case by case before submission. On the bank program’s ladder, that review is where 65% to $5,000,000, 60% to $10,000,000, and 55% to $30,000,000 apply. Second homes and investment properties take their own ladders, and the purchase ceiling runs 0 to 15 points under the primary figure depending on the band. Because the asset-allowance path itself caps at 80%, a borrower qualifying on assets should plan around that ceiling regardless of the ladder.
Credit and reserves tighten with size too. Most programs set a floor of 660 on the portfolio program and 700 above the super-jumbo line. Reserves step from 3 months to 6 to 9 as the balance rises. Cash-out is capped at $1,500,000 above 60% LTV on the portfolio program, and cash-out proceeds cannot be used to satisfy reserves on the largest files.
Where the General Rule Breaks
The mechanics above are a general rule. These are the cases where it bends or fails.
Investment property. The asset-allowance and assets-only paths apply to primary and second homes only. A rental purchase usually is reviewed on a different basis. Because credit to buy non-owner-occupied rental property is treated as business-purpose credit, it sits outside the consumer framework and typically runs on the property’s own cash flow. Qualifying on the property’s income instead of the borrower’s portfolio also keeps the asset pool untouched. Tax treatment varies; consult a qualified professional.
Owner-occupied small multifamily. The unit count and the loan’s purpose decide how a file is classified. A cash-out for personal use against a rental can still be consumer credit. A broker reads the purpose of the loan, not just the label on the property.
Large cash down payments. A big down payment shrinks the pool that creates income. Borrowers often find that a lower down payment with a larger divisor-friendly pool sizes better than the reverse. Run both before committing cash.
Concentrated or volatile holdings. A portfolio heavy in one stock can drop between application and closing. Lenders look at the balance on the statements they hold, so a drop can lower qualifying income mid-file.
Assets that never count. Business accounts, gifts, cryptocurrency, and unvested equity are excluded in full, even when they are large. This catches founders whose wealth is mostly company stock.
The two meanings of the phrase. Some people use asset depletion to mean how much liquid cash a buyer spends at closing. That is a cash-to-close question, not an income method. This article covers the qualifying method.
Purchase, Rate-Term, and Cash-Out
Purchase is the cleanest use, because the borrower is already moving money and the file is sized against the price. Rate-and-term refinances run at the same ceilings on most rungs of the ladder.
Cash-out tightens. On a primary residence, cash-out ceilings step down as loan size rises, and the largest loans are subject to individual review. At lower leverage, the portfolio program carries no proceeds cap, while higher leverage brings a cap on proceeds. The exact terms vary by lender and program and follow a full review of property, leverage, and credit.
Retirees weighing a refinance against a sale face a real fork. For a closer look at that decision, see Lendmire’s piece Jumbo Cash-Out and Stay vs Sell for a Retiree Using Asset Depletion.
Who It Fits (and When Something Else Is Better)
Asset depletion suits a borrower whose wealth lives in a portfolio and whose taxable income does not reflect it. Retirees, executives with equity compensation, and investors who live on distributions are the common profiles.
It is the wrong lane when deposits tell the story better. A founder whose business account shows heavy monthly deposits often is reviewed on bank statements instead. Twelve or 24 months of eligible deposits are divided after an expense ratio, and transfers from the borrower’s own business into a personal account count at 100%.
| If your strongest resource is | The likely lane |
|---|---|
| A large liquid portfolio | Asset depletion |
| Heavy monthly business deposits | Bank statements |
| Rent that covers the obligation | DSCR on a rental |
| Steady W-2 pay and clean returns | A traditional jumbo |
A traditional jumbo can be cheaper to run when pay and returns support the loan cleanly. If your documented income comfortably clears the ratio, there is no reason to use the portfolio at all. Asset depletion earns its place when the paper income understates reality.
Risks and Tradeoffs
Three tradeoffs deserve a hard look before a file is submitted.
First, the pool is finite. Every dollar that goes into the down payment or reserves is a dollar that no longer produces qualifying income. Large files can hit a ceiling where more cash down actually lowers the loan the borrower can carry.
Second, markets move. A portfolio that qualified at application can be worth less later. Borrowers with concentrated positions should expect the lender to rely on current statements.
Third, this path generally prices and underwrites as non-QM, so terms and leverage differ from a traditional jumbo. Programs change, and every file is underwritten individually.
One practitioner pattern is worth stating. On large asset files, the pool usually clears the income test long before it clears the reserves test. Borrowers who plan reserves first, and then work out the loan, tend to avoid last-minute resizing.
Documentation and Application Steps
A clean file usually includes:
- Consecutive recent statements for every account used, showing the borrower’s name and access
- A written explanation and paper trail for any large recent deposit
- A revocable living trust document if assets sit in one
- The usual credit, appraisal, and property documents
- Retirement account statements showing vesting, with age noted for the 80% treatment
Before applying, confirm which accounts count, total the pool after haircuts, net out the planned down payment and reserves, and decide which divisor your situation fits. For a retiree living on assets, Lendmire also explains how a jumbo lender sizes the loan on asset depletion.
Lendmire’s consumer mortgage lending is licensed in 16 states: AL, CA, CO, FL, GA, IN, MI, MT, NM, NC, OH, PA, TN, TX, VA, and WA. If you are financing a high-balance property on your assets rather than income documents and want to see how the numbers work, Lendmire can help you compare super jumbo asset-qualification options based on your liquid assets, the property, credit profile, leverage, and your goals.
Frequently Asked Questions
Do I have to withdraw the money to qualify?
No. Nothing is sold, drawn down, or pledged. The depletion step is arithmetic the lender uses to size the loan. The assets must still be verified with statements, and they must remain available through closing.
Is this the same as spending assets at closing?
No. Spending cash at closing reduces your pool, but the loan method is a separate idea. Closing costs and the down payment do come out of the pool before the divisor is applied, so the two interact, but they are not the same thing.
Can retirement accounts count?
Yes, at a discount. Through select wholesale programs, retirement balances typically count at 70%, or 80% once the borrower is 59½ or older. Business funds, gifts, cryptocurrency, unvested stock, and most trusts do not count at all.
Does it work for a rental property?
Usually not. The asset paths cover primary and second homes. For a pure rental purchase, qualification more often rests on the property’s own rental income covering the obligation, which also leaves the portfolio untouched.
How large can the loan be?
Across our wholesale network, jumbo files run from $300,000 to $30,000,000 through two programs. Every file above $4,000,000 is reviewed case by case before submission, and leverage falls as size rises, all subject to full underwriting.
For current guidelines and terms, see Lendmire’s super jumbo bank statement loan programs page.
Lendmire’s self-employed mortgages page presents both super jumbo programs, bank statement and DSCR, side by side.
About Lendmire
A non-QM mortgage broker (NMLS# 2371349), Lendmire arranges DSCR financing for real estate investors in 41 markets — 40 states plus Washington, D.C. Because deals are underwritten primarily on property cash flow rather than personal income documentation, the structure suits self-employed buyers and entity-owned portfolios. Lendmire places loans through wholesale investor lenders; it is not a direct lender. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Cornell LII, 12 CFR 1026.43
This article is part of Lendmire’s super jumbo bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How Much Asset Depletion Adds to a Super Jumbo Bank Statement Loan · How a La Jolla Bank Statement Jumbo Loan Works · How a Super Jumbo Bank Statement Second-Home Loan Works
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.