Freddie Mac Changes Asset Depletion Formula to 180 Months

Freddie Mac just made one of its most meaningful changes to asset depletion mortgage guidelines in years. Under Bulletin 2026-10, Freddie is making it easier for borrowers with substantial savings, brokerage accounts and other accumulated assets to convert that wealth into qualifying mortgage income. The new rules officially apply to mortgages with closing dates on or after February 3, 2027, but lenders are permitted to implement them immediately.

There is a lot to like here. Freddie is cutting its asset depletion divisor from 240 months to 180 months, eliminating the age requirement for borrowers using depository accounts and securities, opening the program to investment properties and removing the program-specific 80% LTV ceiling. But Freddie also added meaningful documentation requirements, including 12 months of seasoning for many depository and securities accounts. And while the changes make Freddie Mac considerably more competitive with other asset depletion mortgage programs, they still do not match the qualification power or flexibility available through many Non-QM lenders.

What Changed With Freddie Mac Asset Depletion?

Freddie Mac refers to this strategy as using accumulated assets as income. The concept is essentially the same as an asset depletion mortgage: eligible assets are converted into a hypothetical monthly income figure that can be used when calculating the borrower's debt-to-income ratio.

The headline change is the formula. Freddie previously divided net eligible assets by 240 months. Under the new rule, that becomes:

Net Eligible Assets ÷ 180 Months = Monthly Qualifying Income

That change alone increases the qualifying income generated from the same portfolio by 33%.

A borrower with $1.8 million in net eligible assets, for example, would previously have generated $7,500 per month of qualifying income under the 240-month calculation. The new 180-month formula produces $10,000 per month without the borrower earning another dollar, selling another investment or increasing a retirement distribution.

But the divisor is only part of Freddie Mac's changes.

Under Freddie Mac Bulletin 2026-10, the updated accumulated-assets guidelines also:

• Remove the special 80% maximum LTV requirement. Freddie will instead allow the transaction to follow the normal LTV, TLTV and HTLTV requirements applicable to the underlying mortgage. That can make asset depletion usable with smaller down payments in scenarios where Freddie's standard guidelines permit it.
• Remove the age restriction for depository accounts and securities. A younger entrepreneur, investor or financially independent borrower no longer has to wait until age 62 simply because most of their wealth sits in savings or brokerage accounts.
• Allow all occupancy types. Primary residences, second homes and investment properties can qualify, a meaningful expansion for borrowers using accumulated wealth to acquire real estate.
• Require at least $30,000 in net eligible assets. The amount is determined after applying the applicable calculation and deductions, not simply by looking at the headline balance on an account statement.
• Limit eligible transactions to purchases and no-cash-out refinances. This remains an important restriction, particularly for wealthy homeowners hoping to access equity.
• Require an Accept Mortgage. The file must receive the appropriate automated underwriting approval rather than being manually underwritten into the program.

These changes move Freddie substantially closer to the way sophisticated asset-based lending works in the Non-QM market, but Freddie is still operating within conventional mortgage underwriting.

The Age Requirement Is Gone, But Freddie Added a 12-Month Asset History

Eliminating the age requirement will probably get most of the attention, but the new seasoning rule may create just as much work during underwriting.

Depository accounts and securities generally must now be seasoned for 12 months before the Note Date, unless the account was funded from an eligible documented source. Freddie is effectively saying that it is willing to recognize accumulated wealth regardless of age, but it wants a clearer picture of where that wealth came from and whether it has been consistently available to the borrower.

Freddie also created specific rules for material changes in depository-account balances.

If an account balance has fallen by more than 20% over the 12-month period, the account generally becomes ineligible unless the reduction can be documented as a transfer into another eligible securities or retirement account.

If the account has increased by more than 20%, Freddie generally limits the eligible amount to 120% of the account balance from 12 months earlier unless the increase can be traced to an acceptable source. Those exceptions can include transfers from another eligible account, retirement distributions and documented proceeds from the sale of a business or real estate.

That distinction matters for entrepreneurs and high-net-worth borrowers. Someone who sells a company and suddenly deposits $3 million into a brokerage account has not necessarily created a problem, but the lender needs to document the transaction correctly. Freddie also specifically requires business-sale proceeds used this way to have been held continuously in a borrower-owned depository or securities account for at least 90 days as of the current statement.

Asset depletion can simplify income qualification, but it does not mean documentation disappears. Our broader guide to asset depletion mortgage requirements explains why account type, accessibility, ownership, liquidity and funds needed for closing can matter as much as the total portfolio value.

Freddie Mac vs. Fannie Mae Asset Depletion

Freddie's changes become much more interesting when you compare them with Fannie Mae.

Fannie Mae currently allows certain employment-related assets to be converted into qualifying income. For a 30-year mortgage, Fannie divides net documented assets over the 360-month amortization term. Funds used for the down payment, closing costs and required reserves are deducted, along with applicable penalties for accessing an eligible account.

Fannie also remains considerably more restrictive on who and what qualifies. Its current guidelines generally cap LTV at 70%, increasing to 80% when the owner of the qualifying assets is at least 62. Principal residences and second homes are eligible, but investment properties are not. Checking and savings accounts generally do not qualify unless the balance came from an eligible employment-related source, such as certain retirement or severance proceeds. Cryptocurrency is not eligible.

You can read a deeper breakdown of the Fannie Mae asset depletion formula and age 62 rule, but the practical comparison now looks something like this:

Freddie clearly wins the agency comparison for many asset-rich borrowers. The new 180-month formula alone produces twice as much qualifying income as Fannie's 360-month calculation on a 30-year mortgage.

But Non-QM can still be dramatically more powerful.

A Florida Borrower With $2 Million in Assets: Fannie vs. Freddie vs. Non-QM

Consider a borrower in Florida who has accumulated $2 million in eligible assets but has relatively little conventional monthly income. This is common among retirees in Naples and Boca Raton, investors living primarily off their portfolios and entrepreneurs who recently exited a business.

To compare the formulas cleanly, assume the borrower has $2 million of net eligible assets remaining after any required down payment, closing costs, reserves, account adjustments and applicable asset haircuts. In an actual mortgage, those deductions can materially change the number.

With that assumption:

Fannie Mae — 360 months

$2,000,000 ÷ 360 = $5,556 per month

Freddie Mac — 180 months

$2,000,000 ÷ 180 = $11,111 per month

Non-QM — 60 months

$2,000,000 ÷ 60 = $33,333 per month

Same borrower. Same $2 million. Completely different mortgage qualification.

Freddie's change is significant because it doubles the monthly income generated compared with a 360-month Fannie calculation. But a Non-QM lender using a 60-month depletion period generates 3 times Freddie Mac's qualifying income and 6 times Fannie Mae's.

This is why understanding how much you can qualify for with an asset depletion loan requires more than plugging your portfolio into one generic formula. The lender and loan program can completely change the answer.

Our Asset Depletion Mortgage Calculator compares multiple asset-depletion methodologies to estimate which structure could produce the strongest qualification based on the borrower's assets, income, debts, property and requested loan amount.

Freddie Mac's New Rule Still Does Not Apply to Jumbo Loans

This is probably the biggest limitation for high-net-worth borrowers.

Freddie Mac is changing its conventional mortgage guidelines. It is not creating a Freddie Mac jumbo asset depletion loan.

Once the requested mortgage exceeds the applicable conforming or high-cost loan limit, the borrower needs a jumbo lender. That lender is not bound by Freddie Mac's new 180-month accumulated-assets formula and may use an entirely different underwriting methodology.

That matters because asset depletion and jumbo lending naturally overlap. A borrower with $3 million, $5 million or $10 million invested is often shopping for a property that requires a seven-figure mortgage. The very borrowers who benefit most from turning accumulated wealth into mortgage income are therefore frequently outside the agency loan limits altogether.

For these borrowers, jumbo asset depletion loans can offer loan amounts into the millions while qualifying against brokerage accounts, retirement assets and other eligible wealth. Depending on the lender, jumbo programs can also allow primary residences, second homes, investment properties and cash-out refinances.

We see the same issue with buyers using asset depletion loans in Austin. Someone buying a high-value home in Westlake, Tarrytown or Barton Creek may have an excellent balance sheet but need a loan well above conventional limits. Freddie improving its formula is useful, but it does not make a $2 million jumbo mortgage suddenly eligible for agency financing.

Why Non-QM Asset Depletion Is Still Better for Many High-Net-Worth Borrowers

Freddie Mac deserves credit for making its accumulated-assets guidelines much more useful. For a borrower who can stay within the applicable conventional loan limit, receives an Accept recommendation and meets the new documentation rules, Freddie could offer an excellent combination of asset-based qualification and conventional mortgage pricing.

But when the primary objective is maximizing qualification from wealth, Non-QM still has the advantage.

A 60-month depletion period creates substantially more income than 180 months. Certain Non-QM lenders can accept assets Freddie or Fannie will not. Some programs allow Bitcoin and Ethereum. Others permit cash-out refinances, larger jumbo loan amounts or alternative asset-only calculations that do not rely on a traditional income conversion at all.

The tradeoff is that Non-QM financing can carry a higher interest rate and different down-payment or reserve requirements. A borrower who qualifies comfortably through Freddie should not automatically pay more for Non-QM simply because the guidelines are more flexible.

The important point is that the decision should happen after both structures are calculated.

A borrower might discover that Freddie's new guidelines generate enough income to get the conventional approval and better pricing. Another borrower with the exact same portfolio may need a 60-month Non-QM calculation to qualify for the house they want. A third may need a jumbo asset depletion loan because the requested mortgage is outside agency limits before the income calculation even begins.

The Bottom Line on Freddie Mac's New Asset Depletion Rules

Freddie Mac's 2027 asset depletion update is a meaningful improvement for asset-rich borrowers. Cutting the divisor from 240 to 180 months creates more qualifying income. Removing the age restriction for depository accounts and securities opens the program to younger investors and entrepreneurs. Allowing investment properties and removing the program's special 80% LTV cap broadens the number of transactions where accumulated assets can be useful.

The 12-month seasoning requirement and account-balance tests add documentation, and the biggest limitation remains unchanged: Freddie Mac is still conventional financing. Borrowers who need a true jumbo mortgage, a cash-out refinance or substantially more aggressive asset qualification will still find much more flexibility in the Non-QM market.

That is why asset depletion is particularly well suited to a mortgage broker. There is no single formula worth memorizing. Fannie may use 360 months on a 30-year mortgage. Freddie can now use 180. A Non-QM lender may use 60, 120 or a completely different asset-coverage methodology. The strongest answer depends on the borrower, the assets and the property.

At LendFriend Mortgage, we compare conventional, jumbo and Non-QM asset depletion programs across our lender network before deciding which structure makes the most sense. If you have substantial assets but your income does not reflect your financial strength, the goal is not simply to find a lender willing to count them. It is to find the lender whose formula gives your balance sheet the credit it deserves.