Qualify on what you have saved.
An asset-depletion loan converts eligible liquid assets into qualifying income by dividing them over a set term. It serves retirees, people between careers, business sellers and anyone whose balance sheet is strong while their tax return is quiet.
- Qualifying income
- Eligible assets divided over a set term
- Assets counted
- Checking, savings, brokerage; retirement accounts at a discount, by program
- Assets pledged or sold
- No
- Employment verification
- Not required on most programs
How it works
Conventional underwriting asks what you earn. Asset-depletion underwriting asks what you have. The lender totals your eligible liquid assets, applies a discount to some categories, subtracts the down payment and closing costs, and divides what remains by a set number of months to produce a monthly qualifying income.
The assets are not pledged, moved or spent. They stay in your accounts. The calculation simply recognizes that a person with substantial savings can carry a mortgage even if their reported income is low, which is often true of retirees, recent business sellers, people living on investment returns and borrowers between positions.
Programs differ in which assets count, at what percentage and over how many months. Troy runs the calculation under several programs and places the file where it qualifies most comfortably.
- Retirees with savings and investments but modest reported income
- Business owners who recently sold and are living on the proceeds
- Borrowers between careers or early in a new venture
- High-net-worth buyers who prefer not to document income
- Jumbo buyers whose income is complex but whose assets are not
Not sure you fit? Ask. Troy tells people on the first call when a different program serves them better.
What to consider
Program details vary by investor and change over time. These are the questions that decide whether the loan is right for you; Troy confirms the specifics for your file.
Which assets count
Cash, savings and brokerage accounts usually count in full. Retirement accounts are often discounted, and some programs treat them differently before and after retirement age.
The divisor
Programs divide assets over a set number of months. A longer divisor means lower qualifying income per dollar of assets. Troy compares programs.
Combined with other income
Asset-depletion income can often be added to pension, Social Security or rental income to reach the qualifying threshold.
Pricing
Asset-depletion loans are priced above agency loans. Troy shows the cost next to any agency option you might reach with documented income.
The process
From the first conversation to funding, you deal with Troy.
Share your statements
Recent statements for each account. Troy runs the calculation under several programs on the first pass.
Pre-qualification
Credit review and a written estimate with the asset calculation explained.
Underwriting
Appraisal, conditions cleared personally. Assets stay where they are.
Closing and funding
Signing is scheduled around you. Troy coordinates escrow so the loan funds on the date you planned.
Questions people ask
General answers. The answer for your file comes from a conversation with Troy, not from a web page.
Do I have to move or pledge my assets?
No. The assets stay in your accounts. Underwriting verifies them with statements and converts them to qualifying income on paper.
Do retirement accounts count?
Usually, at a discount that depends on the program and your age. Troy confirms the treatment for the program that fits.
Can I combine asset depletion with other income?
Often yes. Pension, Social Security, rental and investment income can be added to the asset-based figure.
Is this only for large loans?
No. Asset-depletion programs cover conforming and jumbo amounts. The question is the ratio of assets to the loan, not the loan size alone.
Related programs
Often considered alongside this one. Troy prices the alternatives so you can see them side by side.
Bank statement
Self-employed income documented with 12 or 24 months of deposits instead of tax returns.
Jumbo
Loan amounts above the county conforming limit for higher-value homes, with underwriting that reads the whole financial picture.
Home purchase
Conventional, FHA, VA, jumbo and down-payment assistance, with a pre-approval that has been underwritten before the letter goes out.
Refinance
Lower the payment, shorten the term or take cash out, with the before-and-after on the table before you decide.
Talk it through with Troy.
No obligation and no credit pull on the first call. Tell him what you’re trying to do and he’ll tell you whether asset depletion financing is the right tool, and what it would cost.