See if you qualify, free, 60-second check.
An asset depletion mortgage lets you qualify for a home loan using your savings and investments instead of a paycheck. The lender divides your eligible assets by a set number of months to create a monthly qualifying income, so a large brokerage account can stand in for a salary. No employment required.
This solves a real problem. Some of the most financially secure buyers in Texas can't show monthly income: retirees living off a portfolio, founders who just sold a company, investors between deals. Conventional underwriting wants a steady paycheck, and a seven-figure account doesn't count on its own.
Also called asset dissipation or asset utilization, this loan flips that logic. It reads your balance sheet, not your pay stub. Below is the exact formula lenders use, which assets count and at what discount, a worked example with real numbers, and how to tell whether it fits your situation.
Asset depletion income is simpler than it sounds. The lender takes your qualifying assets and divides by a number of months, usually the loan term or a fixed period the program sets. The result is your monthly income for qualifying purposes.
The most common formula looks like this:
Qualifying assets ÷ number of months = monthly qualifying income
The divisor varies by program. Some lenders divide by 360 months (a 30-year term). Others use a shorter period like 84 or 120 months, which produces a larger monthly income from the same assets. A shorter divisor is more generous, so the program's terms matter a lot.
Say you have $1,200,000 in eligible assets and the lender divides by 120 months:
That $10,000 a month is treated as your income, even though you never withdraw a dollar. If the same lender used a 360-month divisor, the figure would drop to about $3,333. Same assets, very different qualifying power. When you compare programs, the divisor is the first thing to check.
Important: you're not required to actually spend the money or set up withdrawals. The formula is a qualifying method, not a payment plan. Your assets stay invested and yours.
Lenders don't take your account balances at face value. They apply discounts based on how liquid and stable each asset is, and some assets are excluded entirely. Understanding the haircuts helps you estimate your real qualifying number.
| Asset type | Typical amount counted |
|---|---|
| Checking and savings (cash) | 100% |
| Stocks, bonds, mutual funds (taxable) | ~70-80% |
| Retirement accounts (if under 59½) | ~60-70% |
| Retirement accounts (if 59½ or older) | ~70-80% |
| Business assets, crypto, restricted stock | Often excluded or heavily discounted |
Why the discounts? Cash is stable and fully available. Investments swing in value and cost something to liquidate. Retirement funds may carry early-withdrawal penalties if you're under 59½, so lenders count less of them. The exact percentages vary by lender, but the pattern above is standard.
The takeaway: your qualifying asset figure is smaller than your net worth. Plan around the discounted number, not the headline balance.
Let's walk a full case. Meet Ellen, 61, recently retired from a career in energy in Houston. She has no salary but a solid portfolio, and she wants a $600,000 home with 25 percent down ($150,000).
Here's her asset picture and how a lender might treat it:
| Account | Balance | Counted | Eligible |
|---|---|---|---|
| Checking/savings | $200,000 | 100% | $200,000 |
| Taxable brokerage | $900,000 | 75% | $675,000 |
| IRA (she's over 59½) | $700,000 | 70% | $490,000 |
| Subtotal eligible | $1,365,000 | ||
Now subtract the money she'll use to buy the home and hold in reserve. Down payment and closing costs run about $165,000, and the program wants $35,000 in reserves left aside. That leaves:
Divide that by the program's 120-month divisor:
$1,165,000 ÷ 120 = about $9,708 per month in qualifying income.
On roughly $9,700 a month, Ellen easily supports the payment on a $450,000 loan, even with property taxes and insurance factored in. She qualifies without a job, a pay stub, or a single withdrawal from her accounts. That's the loan doing exactly what it was built to do.
Costs run higher than a conventional loan because this is non-QM financing. How much higher depends on your credit, down payment, and the strength of your asset picture. We keep current ranges on our rates page rather than quoting numbers that change weekly.
Asset depletion isn't for everyone. It shines for a specific set of buyers.
If you have strong, documentable monthly income, a conventional loan is cheaper and you should use it. If your wealth is mostly tied up in a business, real estate, or restricted stock that lenders discount heavily, the formula may not produce enough qualifying income to help. And if you have earned income but it's self-employed and buried by write-offs, a bank statement loan is often the better match than asset depletion.
You don't have to choose just one method. Many lenders let you stack asset depletion income on top of other income, like Social Security, a pension, part-time W-2 work, or self-employed cash flow documented through bank statements. If Ellen also collected $2,500 a month from a pension, the lender could add it to her $9,700 in asset-based income for an even stronger file. Blending sources is common and often the smartest way to qualify.
How does this stack up against the other ways an unconventional buyer can qualify? Here's a side-by-side.
| Loan type | Qualifies on | Best for |
|---|---|---|
| Asset depletion | Your savings and investments | Wealthy buyers with little monthly income |
| Bank statement | 12-24 months of deposits | Self-employed earners with real cash flow |
| Conventional | W-2 or net tax income | Steady, documentable paychecks |
| DSCR | The property's rental income | Investors buying rentals |
The right choice follows your situation. If you have a portfolio but no paycheck, asset depletion is the natural fit. If you run a business that generates strong deposits, a bank statement loan usually qualifies you on more income. If you draw a steady salary, conventional is cheaper. And if you're buying a rental, a DSCR loan sidesteps personal income entirely.
These aren't mutually exclusive. A retired business owner might use asset depletion for a primary home and a DSCR loan for an investment property the same year. The point is to match the documentation method to how your money actually shows up.
If your first pass at the formula falls short, you have levers to pull before giving up.
Small adjustments compound. A shorter divisor plus a slightly larger down payment can transform a marginal file into a comfortable approval.
The process is document-heavy but predictable. Here's what a lender will want and how the review tends to go.
Texas treats a primary residence as a homestead with strong protections, and it has strict rules about pulling equity back out later. That mostly matters if you plan to refinance and take cash out down the road. Our guide to Texas cash-out refinance rules covers the limits, which are worth knowing before you buy so your long-term plan holds together. For the purchase itself, the homestead rules don't change how asset depletion income is calculated, but they shape what you can do with the home afterward.
If your assets are strong and your income is thin, this loan may be the cleanest path to the home you want. Here's how to move.
If a conventional lender already told you no, don't read that as a final answer. It usually just means the wrong documentation method. Our guide on getting a mortgage after a denial when self-employed covers the regroup, and stated income loans in Texas explains how today's asset and bank statement programs replaced the risky no-doc loans of the past.
Start with the free 60-second eligibility check to see whether your asset picture supports the loan you want, with no credit pull. From there, how it works lays out the full path and the application takes only a few minutes. A strong balance sheet deserves a lender that knows how to read it.
The buyers who benefit most from this loan are often the ones who assumed a mortgage was off the table because they'd stopped drawing a salary. That assumption is wrong. Your wealth is income the moment a lender agrees to read it that way, and asset depletion is the loan built to do exactly that.
See what you qualify for in 60 seconds, free and no credit check. Use the eligibility check at the top of this page.
It's a loan that qualifies you using your savings and investments instead of employment income. The lender divides your eligible assets by a set number of months to create a monthly qualifying income, so you can buy a home without a paycheck.
The lender takes your qualifying assets, subtracts the down payment and required reserves, then divides by a set number of months, often 120 or 360. For example, $1,200,000 divided by 120 months equals $10,000 a month in qualifying income.
Usually, but at a discount. Lenders often count about 60 to 70 percent of a retirement account if you're under 59½ because of early-withdrawal penalties, and closer to 70 to 80 percent once you're older and can access the funds freely.
No. The formula is only a qualifying method. Your assets stay invested and under your control. You're not required to set up withdrawals or draw down the account to get or keep the loan.
Yes. Many lenders let you add asset depletion income to Social Security, a pension, part-time W-2 wages, or self-employed cash flow documented with bank statements. Blending sources often produces the strongest file.
Retirees living off a portfolio, business owners who recently sold, investors with lumpy income, and high-net-worth buyers who keep taxable income low. In short, people with substantial liquid assets but little documentable monthly income.
Most asset depletion programs look for 20 to 30 percent down. A larger down payment improves your rate and lowers how much qualifying income you need from the formula.
Free, no-obligation. See what you qualify for in about a minute.