An asset depletion loan turns your savings and investments into qualifying income. The lender takes eligible assets, subtracts the down payment, closing costs, and reserves, and divides what is left by a set number of months. Non-QM programs commonly divide by 60 to 120 months, while agency programs use 240 to 360. You never withdraw the money. Typical 2026 terms: about 640 to 700 minimum credit, 20% or more down, and roughly $500K or more in eligible assets.
Questions on this page
- How do you calculate asset depletion income?
- What is the Fannie Mae asset depletion calculation?
- What is the Freddie Mac asset depletion calculation?
- Do I have to sell my investments or withdraw money?
- Can retirees get a mortgage with no income?
- Can I combine asset depletion with Social Security or other income?
- Does crypto count for asset depletion?
- Do 401(k) and IRA accounts count?
- How much in assets do I need to qualify?
- Asset depletion vs. bank statement loan: which is better?
- Can I use asset depletion for an investment property?
- What documents do I need for asset depletion?
- Can I use a trust account for asset depletion?
- Can I use my business bank account for asset depletion?
- Is asset depletion the same as a no-doc loan?
How do you calculate asset depletion income?
Use this formula: (eligible assets minus down payment, closing costs, and required reserves) divided by the depletion period equals monthly qualifying income. Eligible assets are discounted first, typically 100% of cash, about 70% of stocks and bonds, and 60 to 80% of retirement accounts. For example, $1.2 million of remaining eligible assets divided by 120 months equals $10,000 a month of qualifying income.
What is the Fannie Mae asset depletion calculation?
Fannie Mae allows employment-related assets to be used as qualifying income only in limited cases, with the remaining eligible assets divided by the loan term in months, typically 360. That long divisor produces far less income than non-QM programs. For example, $1 million divided by 360 equals about $2,778 a month, while the same $1 million divided by 120 equals $8,333. Check the current Fannie Mae Selling Guide for exact eligibility rules.
What is the Freddie Mac asset depletion calculation?
Freddie Mac allows assets as a basis for repayment under Guide Section 5307.1, dividing net eligible assets by 240 months, with strict eligibility rules. In practice, most borrowers relying mostly on assets qualify for more through non-QM asset depletion programs, which divide by 60 to 120 months. Ask a broker to run both.
Do I have to sell my investments or withdraw money?
No. The calculation is on paper only. The lender does not require you to sell, liquidate, or move your investments. You must show the assets are in your name and accessible, and keep enough to cover the down payment, closing costs, and reserves. The remaining balance is simply used to calculate income.
Can retirees get a mortgage with no income?
Yes. Retirees with substantial savings often use asset depletion to qualify without pension or work income, or to supplement Social Security and pension income. Age cannot be used against you under fair lending law, and retirement accounts can count at about 60 to 80% of their value depending on your age and access. A retiree with $2 million in a brokerage account can typically qualify for a sizable mortgage.
Can I combine asset depletion with Social Security or other income?
Usually yes. Many programs let you add asset depletion income to documented income such as Social Security, pension, W-2, or rental income. Combining sources often produces a much larger loan than either alone, and it is common for retirees and recently retired executives.
Does crypto count for asset depletion?
Generally no. Most lenders exclude cryptocurrency from asset depletion because of price volatility. Some allow crypto to be sold and moved into a bank account, then seasoned for a period, often around 60 days, after which it counts as cash. Real estate equity, business assets, and restricted stock are also usually excluded.
Do 401(k) and IRA accounts count?
Yes, with a discount. Retirement accounts commonly count at 60 to 70% if you are under 59 and a half (to account for taxes and early-withdrawal penalties) and 70 to 80% if you are older. Roth IRA balances are sometimes counted closer to 100% because qualified withdrawals are tax-free. You do not need to take distributions.
How much in assets do I need to qualify?
It depends on the loan size. As a rough rule on a 120-month program, every $100,000 of remaining eligible assets supports about $833 a month of income. To support about $8,000 a month, enough for roughly a $700,000 to $900,000 loan depending on rates and taxes, you would need around $1 million of eligible assets left after the down payment, closing costs, and reserves.
Asset depletion vs. bank statement loan: which is better?
Choose asset depletion if you have large liquid assets but little documentable income, such as retirees, recent business sellers, and heirs. Choose a bank statement loan if your business deposits are strong but your savings are modest. If you have both, combining them, or comparing the qualifying income from each, usually finds the best loan amount.
Can I use asset depletion for an investment property?
Yes. Asset depletion is available for primary homes, second homes, and investment properties. For an investment property, also compare a DSCR loan, which qualifies on the property's rent and needs no personal income or asset-based income at all.
What documents do I need for asset depletion?
Expect 2 to 3 months of complete statements for every account you want counted (every page), proof the accounts are in your name, retirement account statements that show your access, and the usual ID, credit, appraisal, and purchase contract. No tax returns, pay stubs, or employment verification are needed for the income portion.
Can I use a trust account for asset depletion?
Often yes, if you are a beneficiary with full access to the funds and the trust documents show it. Lenders typically ask for the trust agreement or a certification of trust. Irrevocable trusts and accounts you cannot freely access are usually excluded.
Can I use my business bank account for asset depletion?
Generally no. Most programs count only personal liquid assets. Business funds are excluded because the business may need them to operate. If your wealth sits mainly inside a business, consider a bank statement loan or moving funds to a personal account and letting them season.
Is asset depletion the same as a no-doc loan?
No. Asset depletion is a fully documented loan. Your assets are verified with statements and the income is calculated with a published formula. It simply does not use paychecks or tax returns. That is why it meets federal Ability-to-Repay rules and can be used for a primary residence.
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Related: Asset depletion requirements · Asset depletion FAQ · Asset depletion calculator · No income documentation loan · Bank statement loan
Terms shown are typical for 2026 and illustrative only, not an offer or commitment to lend. Programs, rates and guidelines vary by lender and change without notice. Save Financial, Inc. is a California-licensed mortgage broker, NMLS #377740, DRE #01875766.