Asset Depletion Loans: Qualify on Your Assets, Not Your Income

Some borrowers have plenty of money but very little "income" a lender can count — retirees, early-retired investors, and high-net-worth buyers living off their portfolios. For them, an asset depletion loan (also called an asset-based or asset-utilization mortgage) turns accumulated assets into qualifying income. As a broker licensed in Texas and Florida, here's how this non-QM program works.

What an asset depletion loan is

An asset depletion loan is a non-QM (non-qualified mortgage) that calculates a monthly income figure from your eligible assets — instead of from a job, tax returns, or business deposits. The lender takes a portion of your qualifying assets and divides it over a set period to create a monthly "income" used to qualify you. No employment, no pay stubs, no tax returns required.

How the calculation works

The mechanics are straightforward:

1. Total your eligible assets (see below).
2. Apply the lender's usable percentage — often 100% of cash, a large share of brokerage accounts, and typically 70% of retirement accounts for borrowers under 59½ (to account for penalties/volatility).
3. Divide by the depletion period — commonly 60 to 360 months depending on the program.
4. The result is your monthly qualifying income, checked against the mortgage payment.

For example, a program dividing usable assets over 120 months turns $1.2M in eligible assets into roughly $10,000 of monthly qualifying income — no paycheck required.

What counts as eligible assets

• Checking and savings (cash)
• Brokerage and investment accounts (stocks, bonds, mutual funds)
• Retirement accounts (401(k), IRA — often counted at a reduced percentage, especially before retirement age)
• Sometimes vested, liquid portions of other holdings

Assets usually need to be seasoned (in your accounts for a couple of months) and liquid or near-liquid.

Who asset depletion loans are for

• Retirees with strong savings but little taxable income
• High-net-worth borrowers whose wealth is in investments, not salary
• Business owners who reinvest and show little personal income
• Anyone asset-rich but income-light on paper

The trade-offs

Like other non-QM loans, expect a slightly higher rate and a larger down payment than a conventional loan, along with documentation of your accounts. In exchange, you qualify on the wealth you've actually built — even with no employment income at all.

The Texas and Florida angle

Both states draw retirees and high-net-worth buyers, and neither charges state income tax — so more of your portfolio stays intact. Property taxes (higher in Texas) and insurance (higher across much of Florida) still factor into the payment your assets must support, so we build the true, all-in number into the qualifying math.

Julia Kovalskiy is a residential mortgage loan originator (NMLS #2661068) licensed in Texas and Florida. This article is educational and is not a commitment to lend; programs, terms, and eligibility vary by lender and individual circumstances.