Asset depletion loan requirements: assets, credit, LTV, and reserves
Asset depletion loans allow you to use qualify for a mortgage. For most borrowers, these loans require a minimum 660 credit score, 20% down payment on purchases and three months reserves. No employment or tax returns are needed to qualify.
As a licensed and experienced Non-QM Mortgage Broker, we break down every requirement, with the figures lenders actually underwrite your file on.
- No employment verification
- Use your assets as income
- No tax returns or W-2s
- Licensed in AL, GA, FL, TX, SC
The requirements at a glance
Credit score
660 minimum
Best terms above 740
Down payment
20% minimum
Purchase, one unit single family
Asset divisor
60 months
Assets must cover 5 years of payments
Debt-to-income
Up to 55%
With a 740+ credit score
Asset statements needed
3 months
For every account used
Loan amounts
Up to $3M
Higher by exception
Employment
Not required
No job, no problem
Tax returns
Not required
No transcript needed
Reserves
3-6 months
Sometimes waived
Take the guessing out of the equation. Let us get you the answers you need. Take Mortgage Match ->
How do your assets count for an asset depletion mortgage and at what percentage?
Not every dollar counts the same. Cash counts in full because it’s cash. Retirement money gets discounted because reaching it early costs you a penalty, and lenders price that in. Here’s how each account type is typically treated by most guidelines.
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Account type
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How much it's counted
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What to know
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Checking, savings, money market, CDs
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100%
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The cleanest type of account. We count the full balance
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Stocks, bonds, ETFs, mutual funds
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100%
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Based on the most recent documented value, not what you paid. No need to liquidate to count for asset-depletion
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Retirement accounts — under 59½
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70-80%
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The discount covers the early-withdrawal cost. Worth knowing: the full balance often still counts toward reserves even when only 70% counts toward income.
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Retirement accounts — 59½ and over
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80%-100%
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Some lenders may count differently but at 59.5 and over in age allows us to count more of your retirement accounts.
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Business accounts
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Not eligible
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Usually has to move into a personal account first, and that transfer needs documenting.
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Trust assets
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Case-by-case basis
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Revocable trusts where you're the trustee, or irrevocable trusts where you're a beneficiary with immediate access.
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Foreign accounts
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Accepted by some lenders
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Expect translation and currency conversion, and expect it to add time. Though approved, we recommend you transfer the assets to an US bank account.
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Joint accounts
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Eligible
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Typically needs a letter from the other holders confirming you may use the full balance. Some programs require every account holder to be on the loan.
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Cash-out proceeds
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May be eligible
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Most lenders do not count cash-out proceeds for asset depletion but we work with the ones that do
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Keep in mind: Non-QM lenders count assets differently. Non-agency programs such as the Asset Depletion Loan are not governed by government agencies like Fannie and Freddie and no general rules exist.
Therefore, one lender can tell you one thing and the next one something totally different. As mortgage brokers, we help you navigate through the confusion since we work with over 45 different Non-QM lenders.
Not sure if this is a good option or if there’s a better one? Start here: Take Mortgage Match ->
How long do your assets need to be sitting in the account?
Three months. You’ll provide statements covering the most recent three-month period for every account you’re using to qualify. That’s the consistent requirement across the guidelines we work from.
The rule nobody warns you about
Your balances are expected to be reasonably stable across those three months. If an account moves more than 15% up or down over the period, you’ll be asked to explain it in writing, and you may need supporting documentation.
This catches people constantly. Someone decides to tidy up their finances before applying — consolidating accounts, moving money to one bank, selling a position to sit in cash. Every one of those is a variance that needs explaining. We understand that you are probably trying to make things “easier or cleaner” but sometimes, this can put you in a bad situation. Let us guide you through this but the general rule is if you’re within a few months of applying, leave your accounts alone. A large deposit isn’t a problem; an undocumented one is.
Explaining the "divisor" and why this matters more than anything else
The easy way to explain how Asset Depletion loans work is by dividing your qualifying assets over a number of months – that’s your monthly income.
What changes wildly — from one lender to the next, for the exact same person on the exact same day — is that number of months.
The Non-QM Method
The Conventional Loan Method
Here's an example to drive the point better
You have $2 million in eligible assets and the pending sale of your current home will net you $300,000 in equity at closing which you will be using for the down payment of the next property.
The Non-QM Asset Depletion Formula: We divide $2 million by 60 (5 years). This nets us $33,000 a month in qualifying income – a solid number to qualify for a large sized mortgage.
The Agency Fannie Mae Conventional Loan Formula: The only eligible assets are retirement funds held in a 401(k) or IRA. Liquid checking/savings or securities do not qualify.
Assuming $2 million are held in retirement accounts, if the borrower is at least 62 years of age, count 80% and divide by 360 months. The yield is an effective monthly “income” of $4,444.
This is the honest argument for using a broker on this program. We’re not going to tell you we get you a better rate by magic. We’re telling you that the qualifying math itself is different depending on where the file goes, and knowing which lenders use which divisor is our job, not yours.
The biggest number isn't necessarily the best deal - it might just be the one to get you further.
We’d rather say this plainly than let you find out later.
Non-QM produces the largest figure by a wide margin, but it costs more in rate every month for as long as you hold the loan. If a Freddie or Fannie structure gets you the house you actually want, that’s usually the better outcome even though the headline is smaller.
Where Non-QM earns its keep is when the agencies simply can’t get you there — you’re under 62 with most of your wealth outside retirement accounts, you’re buying a rental, or you need cash out. Our job is to run all three and tell you which one wins your file, not to sell you the biggest number.
What gets subtracted before the math?
This is the single most common reason a result comes in lower than someone expected, and almost nothing published online mentions it.
Your down payment, your closing costs and your required reserves are removed from your asset balance before anything is divided. The lender doesn’t divide what you have. It divides what’s left.
What people assume
$1,000,000 in accounts, divided by 60 months, equals about $16,600 a month in qualifying income.
What actually happens
Take out $250,000 down, $30,000 in closing costs and six months of reserves, and roughly $690,000 remains. That’s about $11,500 a month — a third less.
There’s a counterintuitive consequence worth sitting with: a larger down payment can qualify you for less. Every extra dollar you put down is a dollar removed from the pool generating your income. Sometimes the right structure is putting less down and keeping the assets working on the qualifying side. That’s a conversation worth having before you commit to a number.
What credit score and down payment do you need?
Asset programs generally start around a 660–700 credit score. Below that, assets alone usually won’t open the door regardless of the balance. How much you can borrow against the home moves with your score and with what you’re doing.
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Commonly eligible for a conventional loan
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Usually not eligible for conventional
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What you should you know
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Buying or refinancing your rate and term — one unit
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Up to 80% loan-to-value
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20%
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Refinance with cash-out
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Up to 75% loan-to-value
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25% equity - more equity may be needed for loan amounts over $1.5M
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Two to four units
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Up to 70% loan-to-value
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30% down
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Interest-only loan
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Up to 70%, with a credit score at 680+
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30%
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What about the debt-to-income ratio?
Once your assets are converted into a monthly income figure, everything works like a normal mortgage. That income has to cover the new house payment plus your other monthly debts. The usual ceiling is around 50%, stretching to roughly 55% once your credit score reaches about 740.
This is why paying off a car loan before applying can be worth more than it looks. Clearing $600 a month of debt frees $600 a month for the house payment, dollar for dollar — and unlike your asset balance, it’s something you can change quickly.
What gets subtracted before the math?
This is the single most common reason a result comes in lower than someone expected, and almost nothing published online mentions it.
Your down payment, your closing costs and your required reserves are removed from your asset balance before anything is divided. The lender doesn’t divide what you have. It divides what’s left.
What this means in practice
A bigger down payment can make you qualify for less, not more. It’s counterintuitive and it catches people constantly. Sometimes the right move is putting less down and keeping the assets working for you on the qualifying side.
The number that matters
When we talk about “eligible assets” we mean what’s left after the down payment, the closing costs and the required reserves come out. Not your net worth. Not your account balance. The leftover.
Is there a minimum asset balance?
Some programs set one, some don’t, and the ones that do disagree about the number. What’s consistent is the shape of the test. It’s always one of two forms, and you generally need to satisfy only one:
A flat balance
A minimum dollar amount left over after closing. Across the guidelines we work from, that floor lands somewhere between $300,000 and $1,000,000.
Or a multiple of the loan
Total assets worth some multiple of what you’re borrowing — typically between 1.1 and 1.5 times the loan amount.
The critical detail: the flat-balance version is measured after your down payment, closing costs and reserves come out. That’s why someone who genuinely “has a million dollars” can still fall short of a million-dollar floor. They had it this morning; they won’t at the closing table.
One more wrinkle worth knowing. When asset income is a supplement to other income rather than your only source, some lenders waive the minimum asset test entirely — though a few then cap asset income at under half your total qualifying income. If you have a pension or Social Security alongside your portfolio, that structure is often worth asking about by name.
How much do you need in reserves, and how large can the loan be?
Reserves are measured in months of your full housing payment — principal, interest, taxes, insurance and any HOA dues.
The requirement scales with loan size, and some programs waive reserves entirely on a primary residence or a rate-and-term refinance. That waiver is worth asking about directly, because it puts the whole reserve amount back into your qualifying calculation.
Typical loan ceiling
Commonly up to $3 million, with the borrowing ceiling stepping down as the loan gets larger.
Minimum loan
Our minimum loan amount is $125,000. Small loans are harder to place on this program than large ones.
Cash-out limits
Several lenders cap total cash out on a sliding scale tied to your equity — the more equity you keep, the more cash you can take.
What documents will you actually need?
Shorter than you’re expecting, and notably shorter than a conventional file.
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What's needed
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What is never required
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|---|---|
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Three months of statements for every account you're using
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Tax returns — none, for any year
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Verification of deposit covering your three-month average
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ITIN (no SSN)W-2s or pay stubs
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A written explanation for any balance that moved more than 15%
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Employment verification — you don't need a job
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Evidence of access — that the funds are yours and reachable
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Helps, not always requiredA minimum income history
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A letter from co-owners if an account is held jointly
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Proof of liquidation for any investments funding your closing
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How do Fannie Mae and Freddie Mac requirements differ?
Both agencies run their own version of this, at conventional pricing, with published rules anyone can read. They’re stricter about which accounts qualify and far more conservative about the arithmetic — but if you fit, they’re usually the cheaper loan.
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Requirement
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Non-QM Asset Depletion Loan
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Freddie Mac Guidelines
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Fannie Mae Guidelines
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Divided by
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60 months
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240 months
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The full loan term
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Cash and brokerage count?
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Yes, use 100% of balance
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Only with an owner 62+
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No, unless from a severance or retirement payout
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Retirement accounts
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YesYes, at any age
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Yes
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Yes
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Cash-out refinance allowed?
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Yes
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No
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No
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Investment property
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Allowed
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Not allowed
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Not allowed
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Loan amount
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Up to $3M
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Based on conventional loan limit
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Based on conventional loan limit
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The number to take away
A 63-year-old with $500,000 in cash, $700,000 in a brokerage account and $800,000 in retirement, buying with $225,000 down, qualifies on roughly $29,250 a month under Non-QM, $7,312 under Freddie and $1,542 under Fannie. Same accounts, same afternoon. The rules are just written for different purposes — and Non-QM’s larger figure costs more in rate every month you hold it, so the biggest number isn’t automatically the best deal.
Where to go next
How Asset Depletion loans work
The full guide: the formula, the eligibility rules, and how the three names for this program differ.
Asset Depletion calculator
Use our interactive calculator to see how much income can be used from your assets
Buying a rental instead?
If the property pays for itself, a DSCR loan may qualify you without touching your personal income at all.
How we built the numbers on this page
Andes Mortgage is a broker. Every Non-QM figure on this page is synthesized across current wholesale lender guidelines from multiple investors — never a single lender’s program presented as a market rule. Where sources agree we state a figure; where they disagree we publish the disagreement.
- Qualifying income is eligible assets divided by 60 months, the standard corroborated across every wholesale source in our set. The 84-month figure is published openly by a national Non-QM lender; 360 months reflects agency-style asset depletion.
- Cash, CDs and money market accounts count at 100%. Publicly traded stocks, bonds and mutual funds count at 100% of current value. Retirement accounts count at 70–80% under age 59½, with some lenders allowing up to 100% at 59½ and older.
- Down payment, closing costs and required reserves are removed from the balance before the division. This is corroborated across sources and is the single most common reason a result comes in lower than expected.
- Debt-to-income typically caps around 50%, extending to roughly 55% with stronger credit near 740. Maximum loan-to-value on a one-unit primary purchase typically runs 65–80% by credit tier, 60–75% on cash-out, and 50–70% on 2–4 units.
- Some programs set a minimum eligible-asset floor — expressed either as a multiple of the loan amount or a flat balance, and always measured after the down payment, costs and reserves come out. Where lenders disagree, we say so on the page rather than picking a side.
Agency figures
Fannie Mae and Freddie Mac requirements are taken directly from published guidelines, which anyone can verify: Fannie Mae Selling Guide B3-3.4-06, Employment-Related Assets as Qualifying Income and Freddie Mac Guide Section 5307.1, Assets as a basis for repayment of obligations
Review schedule
This is the most figure-dense page we publish, and it is reviewed quarterly against current wholesale matrices and the agency guides. If the verification stamp above is more than three months old, treat the numbers as indicative and ask us to confirm.
Written by Marcos Zambrano, President of Andes Mortgage · NMLS #988935 · mortgage professional since 2013. Program terms and eligibility vary by lender and are subject to change without notice. Figures shown are typical market ranges as of the date above, not a commitment to lend. Andes Mortgage LLC, NMLS #2187991. Equal Housing Lender.
The questions people actually ask
What are the minimum requirements for an asset depletion loan?
A credit score of roughly 660 to 700, a down payment of 20 to 35% on a one-unit purchase, and three months of statements on every account you’re using. Your eligible assets, after the down payment, closing costs and reserves come out, are divided by 60 months to produce qualifying income, and that income has to support the payment within a debt-to-income ceiling of about 50%.
How much do I need in assets to qualify
There’s no single market minimum. Programs that set one use either a flat balance left over after closing, somewhere between $300,000 and $1,000,000, or total assets worth 1.1 to 1.5 times your loan. Because the flat version is measured after closing costs, someone with a million dollars today can still fall short at the table.
Can I use my 401k to qualify?
Yes, at a discount. Under 59½ retirement accounts typically count at 70% of their value toward income, because reaching the money early carries a penalty. At 59½ and over that rises to between 80% and 100% depending on the lender. Nothing is withdrawn or liquidated — the account simply has to exist and be accessible.
Can I combine assets with social security, pension or other income?
Usually yes, and for retirees that’s often the strongest structure. Some lenders cap how much of your total qualifying income can come from assets when it’s a supplement rather than the sole source — and a few waive their minimum asset test in that scenario. Worth confirming before you build a plan on it.
Why does turning 59.5 change my numbers?
Before 59½, pulling from a retirement account carries an early-withdrawal penalty, so lenders discount those balances — typically to 70–80%. Once you’re past it, some lenders will count up to the full balance. If you’re close to that birthday and most of your money sits in retirement accounts, the timing is worth a conversation.
Is this the same thing as an asset qualifier loan?
Close enough that the terms get used interchangeably, but not identical. “Asset utilization” is the method — assets converted to monthly income. “Asset qualifier” is usually a named program built around that method with no employment and no tax returns. “Asset depletion” is the umbrella term most people search. The label matters less than the mechanic: ask whether your assets are being turned into income for a debt-to-income calculation, or added to rental cash flow on an investment loan. Those are different loans.
Do I need a job or tax returns?
Neither. That’s the point of the program. No employment verification, no tax returns, no 4506-C. Lenders document the assets, your credit and the property instead.
Find out which loan fits your status in a few minutes
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Owner & mortgage broker, Andes Mortgage LLC · NMLS #988935
- Guidelines last verified: July 2026 · reviewed quarterly
Andes Mortgage provides mortgage guidance only, not immigration, legal, or tax advice. Figures shown are typical ranges from current wholesale lending guidelines as of the date above — not a single lender’s terms and not a commitment to lend. Program terms and eligibility vary by lender and are subject to change without notice. Andes Mortgage LLC · NMLS #2187991 · Equal Housing Lender.