How do you qualify for a mortgage using assets instead of income?

Why do asset-rich borrowers get denied for a mortgage?

Because the bank asks for your income, not your net worth, specifically your monthly, on-paper, taxable income. For a lot of successful people that number is tiny by design: no W-2, modest distributions, tax-efficient withdrawals. The standard formula has nothing to grab onto, so it stalls, and you get treated like a risk you plainly are not.

You sold the business. Or you retired early. Or you simply saved for thirty years and did it right. There is real money sitting in your accounts, and the day you ask for a mortgage none of it counts the way you would expect.

A seven-figure balance sheet should not lose to a two-line pay stub. There is a loan built to read the balance sheet.

How does asset depletion income work?

The lender starts with your eligible assets, sets aside what the purchase itself needs, meaning the down payment, closing costs, and required reserves, then divides what is left across the loan term. That monthly figure becomes your qualifying income. No employer, and no tax returns.

Two rules matter more than people expect. Retirement accounts count, but at a reduced percentage, because the lender discounts for taxes and early-withdrawal reality. And crypto is not eligible for depletion income: however real the balance feels, it cannot be counted in this calculation.

Cash, brokerage accounts, and other liquid, documented assets do the heavy lifting. The cleaner the paper trail, the smoother the file.

Which assets count, and at what percentage?

Checking and savings count in full. Brokerage accounts get a modest haircut, because the lender assumes you would lose something selling in a hurry. Retirement accounts get a larger haircut, and a larger one still if you are under 59 and a half, because taxes and penalties stand between you and that money. The lender applies the percentage by asset type, adds it up, and divides by a set number of months to produce your qualifying income.

That last line is the one to pay attention to. The divisor differs meaningfully between lenders. Some divide over the full 30-year term, some over a shorter window, and that single choice changes your qualifying income by a lot. Same assets, same borrower, very different loan amounts. Shopping the divisor is a real part of placing this loan.

Two flags. Gift funds are typically not allowed on these programs, because the whole point is that the assets are yours. And assets need seasoning: money that showed up last month usually cannot be counted until it has been sitting long enough to document where it came from.

Bring recent statements for every account. Which lender we use depends on which divisor and which haircuts treat your mix of assets best.

Who is an asset depletion mortgage for?

It fits borrowers who sold a business, retired, or live on investments rather than a paycheck, whose liquid assets comfortably exceed the purchase itself and sit in cash, brokerage, or retirement accounts with clean statements. It is a poor fit when wealth is mostly illiquid, heavily in crypto, or when the purchase would drain the accounts to the floor.

Not sure which side you land on? The math takes one conversation and a recent statement. No pressure, no pitch.

What are the trade-offs of asset depletion?

Programs apply minimum asset floors, meaning they want meaningful balances left over after the down payment, closing costs, and reserves. Pricing runs above conventional, and not every dollar counts the same. Retirement accounts are counted at a reduced percentage and crypto does not count at all.

Straight talk, before you fall in love with the idea.

1. 01

   Minimum asset floors apply.

   Programs want to see real depth, meaning balances left over after the down payment, closing costs, and reserves. If the purchase would scrape the account clean, this is not the tool.

2. 02

   The rate runs above conventional.

   You are paying for flexibility in how income is measured. For the right borrower that trade is easily worth it; it is still a trade.

3. 03

   Not every dollar counts the same.

   Retirement accounts are counted at a reduced percentage, and crypto does not count at all. The eligible number is what matters, and it gets calculated before anyone falls in love with a house.

Add up cash, brokerage, and retirement balances. Subtract the down payment and a year of payments. If what is left is still substantial, asset depletion deserves a look. This is a documentation strategy, not financial advice. Bring your advisor into the conversation whenever you would like.

Frequently asked questions

How is asset depletion income calculated?

Eligible assets, minus the down payment, closing costs, and required reserves, divided by the loan term in months. For example, $1.08 million in eligible assets divided by 360 months produces about $3,000 per month of qualifying income. (Example figures.)

Do retirement accounts count for asset depletion?

Yes, but at a reduced percentage. Lenders discount retirement balances to account for taxes and early-withdrawal reality, so a 401(k) or IRA contributes less than the same dollar amount held in cash or brokerage.

Why does the same borrower qualify for different amounts at different lenders?

Because the divisor differs between lenders. Dividing eligible assets over 360 months produces a much smaller monthly income than dividing over 240, and the haircuts on brokerage and retirement accounts differ too. That is why this loan gets shopped rather than applied for once.

Can I use gift funds on an asset depletion loan?

Typically no. The program qualifies you on assets that are yours, so gifted money usually cannot be counted, and recently deposited funds need seasoning before they are eligible.

Does cryptocurrency count toward asset depletion income?

No. Crypto is not eligible for depletion income. However real the balance is, it cannot be counted in this calculation, so borrowers whose wealth is concentrated in crypto usually need a different approach.

Can I get an asset depletion mortgage with no job?

Yes. The program does not require an employer or tax returns. It requires eligible, documented, liquid assets with enough depth remaining after the purchase, along with credit and a down payment in shape.

Keep reading

• Buying and refinancingIs now a good time to buy a home in Salt Lake City?
• Business ownersCan I get a mortgage in Utah without tax returns?