Which assets count toward asset depletion?

Typically liquid or readily verifiable assets: checking and savings accounts, brokerage and investment accounts, stocks, bonds, mutual funds, some retirement accounts and sometimes a portion of certain trust or business assets. The home you are buying, personal property and most retirement home equity usually don't count.

Do retirement accounts like IRAs and 401(k)s count?

Often yes, but usually at a reduced value — many lenders apply a haircut (commonly 60–80% of the balance) to account for taxes and penalties. Roth IRAs may be counted more favorably than traditional accounts. The lender will tell you exactly how they treat each account.

Is asset depletion the same as a reverse mortgage?

No. A reverse mortgage is a specific loan that lets homeowners 62 and older tap home equity without monthly payments. Asset depletion is a forward mortgage where qualifying is based on your assets — the property is purchased or refinanced normally and the loan is repaid through regular payments.

Can I use asset depletion for an investment property?

Some programs allow asset depletion for investment and second homes, and some are limited to primary residences. Guidelines vary significantly by lender, so the property type and occupancy should be settled with your loan officer early.

What down payment and reserves will I need?

Asset depletion programs generally require larger down payments and reserves than conventional loans — often 20% or more down and a substantial reserve balance after closing. A large asset base usually means both are easy to cover, but they must remain documented and available.

Can I still use Social Security or pension income?

Yes. Asset depletion most often works best alongside steady retirement income such as Social Security, pensions or annuities. The lender combines the calculated asset income with your documentable income to determine the payment you can support.

How long does an asset depletion loan take?

Timelines vary by lender and by how many accounts need to be verified — multiple brokerage, IRA and trust accounts take time to document. A complete, organized asset statement package up front is the single biggest factor in how quickly you get to closing.

Retiree & HNW Guide · 2026

Asset Depletion Mortgages for Retirees & High-Net-Worth Borrowers

You don't need a paycheck to qualify for a mortgage. If you've built substantial savings and investments, an asset depletion loan can turn your balance sheet into qualifying income.

By Saman Khanian

Mortgage Professional

10 min read

Apply Now (877) 885-0111

Senior couple at home reviewing investment and savings paperwork together

Your portfolio can be your qualifying income

What asset depletion is

Your savings become qualifying income — on paper.

Conventional lending asks how much income arrives each month. Retirees and high-net-worth borrowers often have the opposite situation: modest monthly income, but substantial wealth in savings, investments and retirement accounts. Asset depletion lending was designed for exactly that profile.

The lender takes the eligible assets you can document, applies any haircuts for taxes or access limits, divides the result by the loan term, and arrives at a monthly figure it treats like income. That figure — added to Social Security, pension or annuity income — supports the new mortgage payment.

In short: you don't have to liquidate your portfolio to buy a home. You just have to prove it exists, that it's accessible, and that it's large enough to cover the payments under the lender's calculation.

Who qualifies on assets

Buyers whose wealth isn't in their paycheck

If your balance sheet is stronger than your monthly income, this program is worth a serious look.

Retirees with modest fixed income

Social Security and a pension may not support the payment on their own, but a well-funded portfolio does — and asset depletion lets the lender count it.

High-net-worth buyers between ventures

Business owners who sold a company or are between deals can qualify without drawing a salary they don't need.

Early retirees living off investments

Withdrawals from brokerage accounts aren't steady W-2 income. Asset depletion reads the balance sheet instead.

Buyers of high-value homes

Jumbo purchases where income documentation doesn't tell the whole story can fit asset-based programs.

Asset depletion is not the same as a reverse mortgage. It's a forward mortgage with regular payments, and it isn't limited to buyers over 62. If you're already retired and want to access home equity, ask separately about reverse mortgage options.

Eligible assets

Which of your assets actually count

Not every dollar on your statement is treated the same. These are the categories lenders look at, and how they typically treat each.

Brokerage & investment accounts

Usually 100%

Stocks, bonds, mutual funds and ETFs in a taxable brokerage account are typically the strongest and most readily counted assets.

Checking & savings

Usually 100%

Liquid cash is simple to verify and usually counted at full value. Seasoned funds (for down payment) may need a 60-day history.

Traditional IRA & 401(k)

Haircut applied

Counted at a reduced value — often 60–80% — to account for taxes and early-withdrawal penalties if you're under 59½.

Roth IRA

Often higher %

Because withdrawals are tax-free after the five-year rule, some lenders count Roth accounts at a higher percentage than traditional retirement accounts.

Trust & business assets

Case by case

Countable in some programs, but requires extra legal and financial documentation. Lender rules vary widely here.

Home equity & personal property

Usually excluded

Equity in the subject property or other homes, and non-financial assets like vehicles, art or jewelry generally don't count.

Haircuts and eligibility vary by lender and program. Always confirm treatment of specific accounts in writing before relying on them to qualify.

The math

How lenders turn assets into income

The calculation is straightforward once you know it. This is a simplified view — exact methods vary by program.

Total eligible assets

Add up only the accounts the program counts — cash, brokerage, retirement accounts at their accepted value.

Apply the haircut

Retirement and restricted accounts are reduced by a lender-defined percentage to account for taxes and access limits.

Subtract reserves and down payment

Funds you'll use for the down payment and the reserves the lender requires are set aside first.

Spread over the loan term

The remaining assets are divided by a term the lender sets — often the full loan term in months (360 for 30 years) — to produce monthly qualifying income. Some programs use a shorter divisor, which lowers the income figure.

Illustrative example

Brokerage & savings (counted 100%): $800,000
Retirement accounts (counted at 70%): $1,400,000 → $980,000
Total counted assets: $1,780,000
Less down payment & reserves: – $500,000
Remaining assets: $1,280,000
Monthly asset income (÷ 360): ≈ $3,556
Plus Social Security & pension: + $4,200

Figures are hypothetical and for illustration only. Your qualifying income depends on the lender's specific method, account types and required reserves.

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Documentation

What lenders will ask for

Asset-heavy files are mostly about verification. Organized statements from the start make the difference between a smooth process and a long one.

Asset statements

Most recent two months of statements for every counted account
Full page statements — not screen captures
Retirement statements with vesting details
Documentation of any large recent deposits

Income documentation

Social Security award letter or benefit statement
Pension or annuity statements
Tax returns if used
1099-R or W-2G if other income is used

Identity & credit

Government-issued ID
Credit authorization
Personal financial statement
Explanations for any credit issues

Property & title

Purchase contract
Appraisal and title commitment
Insurance quote
HOA documents if applicable

Cost & trade-offs

What an asset depletion loan really costs you

Fair comparison, not a pitch. These are the trade-offs before you commit.

What it gains you

No paycheck required — your balance sheet does the qualifying
You don't have to liquidate investments to buy the home
Works alongside Social Security, pensions and annuities
Useful for jumbo purchases and high-value markets
Keeps the portfolio working instead of draining it for cash

What it costs you

Higher rates and fees than conventional mortgages
Not all accounts count, and retirement accounts are discounted
Higher down payments and substantial reserves required
More extensive asset documentation and verification
Property type and occupancy rules vary by lender

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Coordinate with your financial advisor. Large down payments, reserve requirements and account haircuts all interact with your investment and tax strategy. A loan officer and your advisor should see the same numbers before you commit.

Frequently asked questions

What retirees and high-net-worth buyers ask us most.

It's a Non-QM loan that calculates qualifying income from your investable assets instead of your paycheck. The lender divides eligible assets by the remaining loan term to estimate a monthly 'income' from those assets, then uses that figure alongside other income to qualify you.

Written by

Saman Khanian

Mortgage professional at Equitable Lending, helping retirees, investors and high-net-worth buyers finance homes across Los Angeles and nationwide.

You've built the assets. Let's put them to work.

Share a summary of your accounts and what you'd like to buy. We'll show you the programs that count your assets — and what they mean for your rate and reserves.