For high net worth individuals, securing a home loan can sometimes feel unnecessarily difficult. Despite having millions in liquid assets, traditional lenders often zero in on employment income, leaving asset-rich borrowers searching for alternatives. This is where asset depletion mortgages offer an ideal solution—allowing you to qualify for a mortgage using your wealth instead of conventional income.

What Is an Asset Depletion Mortgage?

An asset depletion mortgage is designed for borrowers who have significant liquid assets but little or no traditional income. Lenders calculate a theoretical monthly income by dividing eligible assets over a standard term, often 360 months (30 years). The 360-month divisor is preferred by most borrowers because it provides higher qualifying income and helps secure better loan terms.

What sets asset depletion mortgages apart is that they enable borrowers to qualify without relying on pay stubs, tax returns, or business financials. Instead, your wealth does the talking. These loans are particularly popular among retirees, investors, entrepreneurs who have exited a business, or anyone whose income on paper doesn’t reflect their true financial strength. Asset depletion loans are available for primary residences, vacation homes, and in some cases, investment properties. The key factor is the lender’s ability to assess your assets as a reliable source for mortgage repayment.

Borrowers should be aware that lenders apply detailed scrutiny to the type, source, and stability of assets, and different lenders may use varying formulas or requirements. That’s why these loans are best approached with expert guidance to ensure the asset calculations work in your favor.

HNW Individual with $5M in assets vs $3M in assets

Imagine this: You’re eyeing a $1.5 million luxury home in Austin’s Zilker neighborhood. You’ve accumulated $5 million in liquid assets through disciplined investing and financial planning. You have no W-2 job, no business income, and no pension. In a conventional lending world, this could pose a challenge. But with asset depletion, your wealth is translated into qualifying income.

A lender might divide your $5 million by 360 months, giving you approximately $13,888 per month in qualifying income. With this, you could comfortably support a $1.2 million mortgage at 7%, with principal and interest payments near $7,980 per month. Even with taxes and insurance pushing your total housing cost toward $9,000, your debt-to-income ratio would remain well within standard lending limits.

Now consider another scenario: You’re aiming to purchase a $1 million home in Austin’s Allendale neighborhood. You have $3 million in liquid assets and no conventional income source. A lender using a 360-month divisor would calculate qualifying income of about $8,333 per month. This level of income could support a mortgage of around $800,000 at 7% interest, with principal and interest payments near $5,320 per month. Even after adding taxes and insurance, you would remain within typical debt-to-income thresholds. This example shows how asset depletion can work across different asset levels and price points, helping diverse high-net-worth clients secure their ideal home.

It’s important to note that while these examples are only meant to illustrate how asset depletion works, many high-net-worth individuals can use this loan type to buy their dream home with far less in assets. At LendFriend, we help a wide range of clients—from those with several million in assets to those with lower balances—find the right lender and structure their asset depletion mortgage successfully.

How Lenders Treat Your Assets

Lenders treat asset types differently, and understanding these nuances is key to knowing how much qualifying income your assets can generate. Cash in checking or savings accounts and standard brokerage funds are typically counted at 100% of their value because of their liquidity and stability. Retirement accounts such as IRAs or 401(k)s might only be counted at 70% to 80% of their value, and often only if the borrower is of retirement age or can access the funds without penalty. Revocable trusts are generally acceptable, as the borrower retains control of the assets, whereas irrevocable trusts are usually excluded because the borrower no longer has access to the funds. Alternative assets like cryptocurrency, private equity, or foreign accounts are rarely accepted and are typically considered only by niche or specialty lenders willing to underwrite complex asset classes.

In addition to valuing assets differently, lenders also impose requirements such as seasoning periods, usually demanding that funds be held in an account for at least 60 days to ensure they aren’t borrowed or recently gifted. Before calculating qualifying income, lenders will deduct any amounts designated for the down payment, closing costs, and required reserves, which can vary from six months to two years of housing expenses depending on the lender and the loan size. Some lenders may even discount volatile asset classes further or require additional reserves if the portfolio is heavily weighted toward equities. These layers of analysis make it essential to work with a mortgage broker who understands how to present your assets effectively and negotiate with lenders on your behalf.

Why Work with a Mortgage Broker

When it comes to asset depletion loans—or any type of home financing—working with a mortgage broker offers distinct advantages over going directly to a bank or lender. Unlike a single bank that can only offer its own products and guidelines, brokers have access to a wide range of lenders, including niche and specialty institutions. This means brokers can compare multiple offers, giving you access to better rates, terms, and loan structures that align with your unique financial profile.

Mortgage brokers are solution-finders. They understand the complexities of asset depletion loans and know how to navigate varying lender requirements, asset type treatments, and reserve rules. A broker can package your application to highlight your strengths and address potential concerns before they become roadblocks, saving you time and stress.

At LendFriend, we specialize in helping high-net-worth clients secure asset depletion mortgages that work with their broader wealth strategies. Our team has extensive experience structuring loans for complex financial profiles, negotiating competitive terms, and ensuring a seamless, client-focused process from start to finish. We take pride in turning your financial strength into homeownership success.

Who Benefits Most from Asset Depletion Mortgages

Asset depletion mortgages are ideal for retirees, investors, entrepreneurs who have recently sold businesses, trust beneficiaries, and anyone whose wealth outpaces their reported income. They are particularly beneficial for high-net-worth individuals seeking primary residences, vacation properties, or even select investment properties where traditional income documentation may be lacking. This loan type offers flexibility that empowers a wide variety of borrowers to achieve their homeownership goals without traditional proof of income.

Examples of who benefits most include:

• Retirees — Individuals living off savings or investments who want to avoid tapping retirement accounts prematurely (learn more)
• Entrepreneurs — Those who have sold a business or are between ventures
• Investors — People who live off portfolio income that isn’t reflected on W-2 forms
• Trust beneficiaries — Individuals receiving distributions that don’t count as standard income
• Professionals on sabbatical or career break — High-net-worth individuals who have paused traditional income but maintain substantial assets

Challenges of Asset Depletion Loans and How to Overcome Them

Borrowers may face high reserve requirements, discounted asset valuations, or additional scrutiny if portfolios are equity-heavy or volatile.

• High reserve requirements. Some lenders demand reserves equal to 12-24 months of housing expenses. Solution: A broker can help you find lenders with more flexible reserve guidelines or help structure your assets to meet these requirements efficiently.
• Discounted asset valuations. Retirement funds or equity-heavy portfolios may be heavily discounted in qualifying calculations. Solution: A broker identifies lenders who apply more favorable asset treatment or advises on shifting asset allocations where appropriate.
• Market volatility causing portfolio fluctuations. This can lower qualifying income if asset values dip during underwriting. Solution: Lock in valuations early or provide additional documentation showing long-term stability to mitigate concerns.
• Complex asset structures (e.g., trusts, foreign holdings). These can trigger lender hesitation or extended underwriting. Solution: Work with a broker who has experience presenting complex financial profiles and can package your file for smooth lender approval.

Comparing Asset Depletion to Bank Statement Loans 

Asset depletion loans differ from bank statement loans in that bank statement loans qualify income based on actual business deposits over a set period, usually 12 to 24 months, rather than converting assets into theoretical income. Asset depletion is more suited for borrowers who do not have active business cash flow but possess significant liquid wealth.

Bank statement loans can work well for self-employed borrowers with strong business income but fewer liquid assets, while asset depletion loans cater to those whose financial strength lies in their portfolio rather than ongoing deposits. Asset depletion shines when you want to leverage your wealth without incurring debt against your investments or relying on business cash flow documentation.

Tax, Estate, and Financial Planning Considerations

Asset depletion loans can align with tax-efficient strategies by allowing you to retain investments rather than liquidate them. However, down payments or reserve requirements may trigger capital gains if assets are sold. Collaborate with financial advisors to ensure mortgage decisions fit your broader wealth and estate plans.

Key considerations include:

• Capital gains exposure: Selling investments to meet down payment or reserve requirements may trigger significant tax liabilities.
• Estate planning implications: Using asset depletion loans can help preserve assets within trusts or estate structures, but the loan terms must align with long-term estate goals.
• Cash flow strategy: Asset depletion helps avoid disrupting cash flow from other investments, allowing wealth to continue compounding.
• Diversification and liquidity: Be cautious about concentrating too much on housing wealth versus maintaining a balanced portfolio.

Frequently Asked Questions

Can I combine asset depletion with other income? Yes. Many lenders allow you to combine asset depletion income with documented income sources such as part-time earnings, rental income, pensions, or Social Security. This blended approach can increase your qualifying income and improve loan terms.

Are rates higher than conventional loans? Asset depletion loan rates can be slightly higher than conventional loans due to their specialized underwriting. However, working with the right broker can help you secure highly competitive rates that reflect your overall financial strength. Note that factors such as loan-to-value (LTV), debt-to-income (DTI) ratio, and credit score can also significantly influence the rate you receive.

Are foreign assets accepted? Some lenders will consider foreign assets, but they generally require extensive documentation, currency conversion details, and proof of liquidity. This is where a broker’s expertise can make the difference in getting such assets accepted.

What’s the minimum asset level? There is no universal minimum, but most lenders look for at least several hundred thousand dollars in eligible liquid assets after down payment and reserves. The exact requirement depends on loan size, property type, and lender guidelines.

Final Thoughts

Asset depletion mortgages provide a powerful, flexible financing tool for high-net-worth buyers. They enable you to leverage your wealth intelligently without liquidating investments or disrupting your broader financial strategy. The key is working with a broker who understands how to present your profile to lenders in the best possible light.

LendFriend Mortgage has helped many HNW individuals with little to no income buy a home. We'd love to help you too. Give us a call at 512.881.5099 or get in touch with me by completing this quick form, and I'll reach out as soon as possible.