The Quick Read: An assets-only loan is reviewed around the liquid money you already hold instead of on traditional personal-income documentation or bank deposits, and the lender never asks you to sell or move those funds. It suits high-net-worth borrowers whose taxable income understates their wealth, through select wholesale programs, subject to full underwriting.
- Qualification runs on verified U.S. liquid assets equal to the loan amount, plus closing costs, plus sixty months of any net loss on your other residential property.
- This path carries no debt-to-income test. A related path, the asset allowance, turns your assets into monthly income and does test debt-to-income.
- Retirement accounts typically count at 70% of their value, or 80% once you are 59½ or older.
- Business funds, gifts, unvested stock, cryptocurrency and most trusts never count.
- Credit, property, appraisal and reserves are underwritten as on any other jumbo file.
What Is an Assets-Only Loan, Really?
An assets-only loan is a mortgage where your balance sheet carries the file. You show the lender that your liquid assets cover the loan and its costs. The lender then treats repayment risk as covered.
One clarification before going on. The phrase also appears in business lending, where companies borrow against receivables or inventory. That is a different animal. This article is about a home loan for a person.
Borrowers who use this path usually look the same. A founder just sold a company. A physician or attorney writes off heavily, so traditional personal-income documentation shows little. A retiree holds seven figures in brokerage accounts but draws modest income. In each case the paperwork says one thing and the net worth says another.
Industry people use many names for the same idea: asset depletion, asset dissipation, asset utilization and asset qualifier. They do not always mean the same mechanics. In the wholesale network Lendmire works with, two distinct paths exist, and the difference drives everything else. This article keeps them separate.
Key Terms Defined
- Assets-only: a qualification path where verified liquid assets must equal the loan plus costs. No income is calculated.
- Asset allowance: a path that divides liquid assets by a set number of months to create imputed monthly income.
- Divisor: the number of months (36, 60 or 84) used in that division.
- Haircut: the discount applied to an asset that can lose value or carries withdrawal penalties.
- Liquid assets: cash and holdings you can turn into cash without selling a building, such as checking, savings, money market and brokerage accounts.
- Debt-to-income (DTI): your monthly debts divided by your monthly income.
- Non-QM: a mortgage that falls outside the standard rules for conventional loans and is underwritten by its own guidelines.
- Reserves: liquid money left over after closing, counted in months of payments.
How Does Underwriting Treat It, Step by Step?
The lender runs a fixed sequence. The details shift by program, but the order is stable across the network.
1. Inventory your assets. You list checking, savings, money market, brokerage and retirement accounts. The lender looks for U.S.-based accounts held in your own name.
2. Remove what never counts. Business-owned funds, gifts, unvested stock, cryptocurrency, borrowed money and most trusts are out. A revocable living trust is the exception that can stay in.
3. Apply haircuts. Cash counts fully. Retirement accounts typically count at 70%, or 80% once you are 59½ or older.
4. Subtract the deal’s own needs. Your down payment, closing costs and required reserves come out first. The same dollar cannot do two jobs.
5. Run the test for the path you chose. On assets-only, what remains must at least equal the loan amount plus closing costs plus sixty months of any net loss on other residential property you own. On the asset allowance, the remainder is divided by the divisor to create monthly income.
6. Check credit, property and reserves. The 660 credit floor on the portfolio program is the starting point, and the bank program varies by scenario. Above the super-jumbo line, 700 applies. Reserves run 3, 6 or 9 months by loan size.
7. Verify with statements. Consecutive account statements show ownership, balance and stability. Large or unusual deposits need a written explanation.
Nothing is liquidated at any step. The math is a qualifying convention, not a withdrawal plan. You keep the money, you keep control of it, and you can keep investing it.
Two Paths, Compared
Most confusion comes from treating these as one product. They are not.
| Factor | Assets-only | Asset allowance |
|---|---|---|
| What the lender tests | Assets cover loan plus costs | Assets divided into monthly income |
| Debt-to-income | None | Yes |
| Divisor | Not used | 36, 60 or 84 months |
| Occupancy | Reviewed per program | Primary and second homes only |
| Best fit | Large asset base, low debts | Assets plus some income |
Think of assets-only as proof of cushion. Think of the asset allowance as a way to manufacture a paycheck on paper.
How the Asset Allowance Divisor Works
The divisor is the number of months over which your pool is spread. A smaller divisor creates more imputed income per dollar of assets.
Across the network, the divisor follows your debt load and loan size:
- 36 months is for borrowers using assets as a supplement, with DTI at or below 60% before the asset income is counted. That spreads the pool over three years.
- 60 months is also a supplement, but with that pre-asset DTI above 60%. That spreads the pool over five years.
- 84 months is for standalone use, or for any loan above $3,500,000. That spreads the pool over seven years.
The 60% test only picks the divisor. With the asset income counted, the file must still fit the 50% DTI ceiling.
The asset allowance is limited to primary and second homes, with an 80% maximum. Both limits describe select wholesale programs, subject to full underwriting.
Here is a comparison without dollars. Two borrowers hold identical pools. One needs a 36-month divisor and the other an 84-month divisor. The first shows more than twice the monthly income. That gap is why the divisor matters more than most borrowers expect, and why program shopping pays off here.
Where the General Rule Breaks
The simple story is that assets replace income. These edge cases are where files actually stall.
Retirement accounts. They count, but at a discount, because withdrawals can carry penalties and market risk. Age 59½ moves the percentage from 70% to 80%.
Double counting. A balance used for your down payment, closing costs or reserves cannot also be counted toward qualifying. This catches borrowers who buy several properties in a row. The same pool cannot support several simultaneous loans.
Other real estate. On assets-only, a rental that loses money at the property level adds sixty months of that net loss to your required liquidity. A profitable rental adds nothing. A portfolio of underwater properties can raise the bar a lot.
Investment property. The asset allowance does not apply to investment property. Investment property also runs about five points lower than a primary residence on leverage at every size. For a rental, the property’s own income usually carries the file instead. That is the DSCR route, where the loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Select lenders in the network offer programs below 1.00 coverage, but leverage and terms adjust. Loans made for a business or investment purpose generally sit outside Regulation Z’s consumer-credit rules, though lenders still apply their own credit standards. The complete DSCR loans guide walks through that path.
Foreign assets. Assets-only counts U.S. liquid assets. Money held abroad does not meet the test. Above the super-jumbo line, files are also limited to U.S. citizens and permanent residents.
Market moves. Brokerage balances change between application and closing. A pool that clears with a thin margin on day one may not clear later. A cushion above the minimum protects you.
The legal frame on a home loan. When the loan is for your own home, federal ability-to-repay rules apply. The CFPB’s compliance guide lists your current or expected income or assets as one of the factors a lender must weigh, and it defines third-party records as those prepared by someone other than you, the lender or the broker. That is why statements must come straight from the institution and verbal claims do not count. It is also why this is not a no-documentation loan.
No national formula. No single national formula governs these programs. Divisors, haircuts and leverage therefore differ from one lender to the next. That variation is why a broker who sees many guidelines can find a better fit than any single lender’s page.
What Counts as an Eligible Asset?
| Asset | Typical treatment |
|---|---|
| Checking, savings, money market | Counts fully |
| Brokerage accounts | Counts, subject to program review |
| Retirement accounts | 70%, or 80% at 59½+ |
| Revocable living trust | Counts |
| Business funds | Never counts |
| Gifts, unvested stock, crypto | Never counts |
Home equity does not count. Neither does the value of the property you are buying.
Seasoning matters too. Money that appeared recently needs a source. Lenders ask where it came from, and they decline files where the answer is a loan, a gift or a transfer from a business account.
How Does Leverage Work at Different Sizes?
Leverage steps down as the loan grows. These are ceilings through select wholesale programs, subject to full underwriting.
On a primary residence purchase, the ladder runs 90% to $1,000,000, 85% to $2,000,000, 80% to $3,000,000, and 75% at the top credit tier to $4,000,000. From there, files are reviewed case by case up to $6,000,000. A separate bank portfolio program takes over with its own ladder: 65% to $5,000,000, 60% to $10,000,000 and 55% to $30,000,000. Everything above $4,000,000 is reviewed case by case before submission, so treat any figure at that size as a starting point, not an offer.
Second homes run lower on their own ladder. Cash-out limits are lower again. Unlimited proceeds are available at or below 60% LTV, and the portfolio program caps cash-in-hand at $1,500,000 above that. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
One broker observation on this: the program with the best-looking headline leverage is rarely the one a high-net-worth borrower should pick. Seasoning rules, overlays and which assets count decide the outcome more often than the headline number does. Reading guidelines side by side before you apply is where most of the value sits.
Assets-Only or the Alternatives?
Three other routes serve the same type of borrower.
- Bank statements measure cash flow. They suit self-employed borrowers with strong monthly deposits. Lendmire’s piece on a statement loan versus an assets-only mortgage covers the comparison in depth.
- DSCR measures the rental, not you. It fits a purchase where rent supports the payment.
- Conventional measures tax-return income. It fails when write-offs shrink what the returns show.
Use assets-only when your deposits are uneven but your liquidity is deep. Use bank statements when deposits are steady and strong. Use DSCR when the asset is a rental. Many borrowers qualify more than one way, and the best file is the one whose weaknesses the guidelines forgive.
Deciding in Practice
Run this self-check before you apply.
1. Add up your U.S. liquid assets. Subtract anything that never counts.
2. Apply the retirement haircut.
3. Subtract your planned down payment, closing costs and reserves.
4. Compare what is left to the loan you want. On assets-only, include costs and any sixty months of net loss on other residential property.
5. If the pool falls short, test the asset allowance. If a rental is involved, test DSCR coverage.
A few red flags: the pool clears only by a hair, much of it sits in retirement accounts or crypto, or recent deposits lack a paper trail. Each of these changes which path fits, or whether to wait.
Tax treatment can depend on how the funds are used and how the property is held. Keep clear records and speak with a qualified tax professional before relying on any deduction.
Frequently Asked Questions
Do I have to sell my investments to qualify?
No. The assets stay where they are and keep working for you. The lender only verifies that they exist and calculates what they support. Your statements are evidence, not a withdrawal plan.
Is an assets-only loan a no-documentation loan?
No. It is reviewed on documented assets under the applicable program, subject to lender guidelines. You provide consecutive statements, explain unusual deposits and meet credit, property and reserve requirements. What changes is that traditional personal-income documentation and employment verification are not the basis for qualifying.
Can I use retirement accounts?
Yes, in most programs, at a discount. They typically count at 70% of their value, or 80% when you are 59½ or older. Business funds, gifts, unvested stock and cryptocurrency never count.
Does assets-only work for an investment property?
Usually not as the main route. The asset allowance covers primary and second homes only, and investment property runs on its own, lower leverage ladder. Property rent or deposits normally carry that file instead.
How is this different from the asset allowance?
Assets-only tests whether your liquid assets cover the loan, with no DTI. The asset allowance divides assets by 36, 60 or 84 months to create income, then tests DTI. The first proves a cushion; the second builds a paycheck on paper.
Next Step
If you are financing a high-balance primary or second home and your wealth sits in liquid assets rather than in your traditional income documentation, Lendmire can help you compare assets-only and asset allowance options across its wholesale network. The comparison is based on your liquidity, the property, credit profile, leverage and your goals. Its 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. Programs change, and every file is underwritten individually.
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
Lendmire — NMLS# 2371349 — is a DSCR and non-QM mortgage brokerage with investor loan programs in 41 markets, including Washington, D.C. DSCR eligibility is commonly reviewed by the lender around property-level rent rather than personal income documentation, subject to lender guidelines, and the brokerage helps arrange financing for LLC-owned portfolios beyond conventional financed-property limits. Recognized by Scotsman Guide as a Top Mortgage Workplace in 2025 and 2026.
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References
2. CFPB ATR/QM Small Entity Compliance Guide
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 a La Jolla Bank Statement Jumbo Loan Works · How Many Months of Reserves Does an Assets-Only Mortgage Require? · How to Qualify for a P&L Only Jumbo Loan
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.