Asset Based Home Loan FAQ: Qualifying With Assets Instead of Income

You have the money. What you do not have is a paycheck, and the lender's system has no field for that.

Here is the whole rulebook, from CMG Financial's Non-QM Sharp Series guidelines (NMLS #1820, revised 09/21/2026).

The two programs

What is asset depletion? Your qualifying assets are converted to monthly income. Qualifying assets with a utilization draw schedule of seven years, meaning qualified assets divided by 84, is used as qualifying income. You then have to pass a debt-to-income test with that income.

What is asset qualifier? Instead of a debt-to-income test, it uses residual income. Qualifying assets are divided by 84 months, and from that figure the total monthly debt obligation is subtracted to produce residual income, which must meet or exceed the residual income requirement. Tax deductions are not imputed when determining residual income.

Why two programs? Both are designed to meet the Ability to Repay requirements. Asset depletion does it with a debt-to-income ratio, asset qualifier does it with a residual income calculation.

Can I combine either one with my job income? No. A borrower using asset depletion or asset qualifier cannot use other sources of employment income. Non-employment income sources are considered case by case.

The minimums

What is the absolute minimum? $450,000 in qualifying assets across both asset depletion and asset qualifier.

Is there a higher requirement? Yes, and it depends on the program.

Asset depletion: you must have the lesser of $1 million in qualifying assets, or qualifying assets greater than or equal to 125% of the original subject loan amount.

Asset qualifier: total post-closing assets must be greater than or equal to 125% of the original subject loan amount.

How long must assets be seasoned? 120 days, unless pre-approved by the investor.

The haircut schedule

Does my whole balance count? No. Net assets are multiplied by these percentages:

• 100% of checking, savings and money market accounts
• 100% of life insurance and annuity cash surrender value
• 80% of the remaining value of stocks, bonds and mutual funds
• 70% of all vested retirement assets
• 60% of current valuation of Bitcoin or other cryptocurrencies

Can I count proceeds from a sale? Yes. Sale of real estate owned counts with a copy of the final closing disclosure and evidence the funds were deposited. Sale of a business asset is permitted with the final settlement statement and evidence of deposit.

What about trust assets? Trust assets must fully meet Fannie Mae guidelines.

What about cryptocurrency? Counted at 60%. The file must include documentation proving ownership, and the current valuation must be sourced exclusively from Coinbase and be dated within 30 days of the note date.

The exclusion people miss

Do my closing funds also count as income? No. If the assets or a portion of the assets are being used for down payment or costs to close, those assets should be excluded from the balance before analyzing a portfolio for income qualification.

Money cannot do both jobs. The down payment comes out first, and what remains is what generates the income figure.

Funds for closing should be liquidated and documented according to asset documentation requirements.

What these programs will not do

Five hard exclusions:

• Non-owner occupied or second homes are not permitted. See the program matrix for maximum leverage and eligibility. These are owner occupied only.
• Cash-out is not permitted.
• Gift funds are not permitted.
• Business assets are not permitted.
• Foreign assets are not permitted.
• Non-occupant co-borrowers are not permitted.

That list is worth reading carefully before you plan around these programs. No cash-out in particular surprises people who assumed a large portfolio meant easy access to equity.

Terms

What leverage is available? Maximum 85% loan-to-value.

What credit score? Minimum 700 FICO.

Are reserves required? No. Reserves are not required for the asset depletion and asset qualifier programs. That is unusual and it is a genuine advantage, though the 125% asset test does similar work.

How are these underwritten? Under the full documentation program matrix, with the restrictions set out in the respective program matrix.

Which program tiers offer them

This is the gate that catches people, and it has nothing to do with your assets.

Sharp Expanded (48 months or more clean housing event history, 0x30x12) and Sharp Premium (36 months or more, 1x30x12) both allow asset depletion and asset qualifier.

Sharp Standard (24 months or more, 2x30x12 and 1x60x24) does not. The guidelines state that asset depletion, asset qualifier, the 12 month third-party P&L and written verification of employment are NOT eligible on that tier.

So a single late mortgage payment can remove asset based qualification entirely, regardless of how large the portfolio is. If you are close to a tier threshold, waiting is frequently the better decision.

Residual income

What is the residual income requirement? Residual income equals gross qualifying income less monthly debt as included in the debt-to-income ratio. If the loan is a higher priced mortgage loan, or if the debt-to-income ratio exceeds 43%, the minimum monthly residual income required is:

• One person household: $1,500
• Two person household: $2,500
• Add $150 for each additional household member

That table governs the asset qualifier program directly and applies to any file above 43% debt-to-income.

Worked example

A borrower with $600,000 in a brokerage account, $400,000 in a vested IRA, and $250,000 in checking, buying with $200,000 down.

First, remove the closing funds. The $200,000 down payment comes out of checking, leaving $50,000 there.

Then apply the haircuts:

• Checking: $50,000 at 100% = $50,000
• Brokerage: $600,000 at 80% = $480,000
• Vested retirement: $400,000 at 70% = $280,000

Qualifying assets: $810,000

Monthly income under asset depletion: $810,000 divided by 84 = approximately $9,642 in monthly qualifying income.

Note what happened to the headline. The borrower has $1,250,000. After removing the down payment and applying the haircuts, the figure that generates income is $810,000. That gap is why running this properly before you shop matters.

Related reading

• Asset based and no-income home loans, the full index for this topic
• Asset Depletion and Asset Qualifier Loans: Turning a Portfolio Into Qualifying Income
• Asset Depletion or Asset Qualifier: Two Programs, Two Completely Different Tests
• Retired With No Paycheck: The Three Ways a Lender Can Build You an Income

Why bring this file to us

• We calculate the haircuts correctly. Account type decides how much of each balance counts, and the spread between types is large.
• We separate closing funds from income assets, which is the mistake that quietly shrinks a qualifying number.
• We tell you which of the two programs fits, because they test completely different things.
• Broker model. Multiple investors rather than one bank's shelf, which is what a file like this needs when the first answer is no.
• You talk to the principal. Ricky Khamis is President of EPiQ Lending and a Certified Mortgage Planner, NMLS #173141, originating mortgages since 1999. Direct line: (480) 999-9842.

EPiQ Lending is NMLS #1936984, at 7975 N. Hayden Road, Suite A-101 in Scottsdale. Verify all of it before you trust any of it: Ricky's EPiQ Lending profile, the Scottsdale branch, and the license itself at NMLS Consumer Access. Hold every lender to that standard, including us.

Send me a statement summary by account type and I will produce your qualifying number the same day. It is arithmetic, not judgment.

Program figures in this post come from the CMG Financial (NMLS #1820) guideline set named above, as published on the revision date given. CMG Financial is the parent company of EPiQ Lending. These figures describe one investor's program at one point in time. Other investors price and underwrite the same borrower differently, guidelines change without notice, and nothing here is an offer of any specific program or terms. Confirm current eligibility on your own file before you plan around any of it.

Equal Housing Opportunity. This is general information, not a commitment to lend or an offer to extend credit. Rates, terms, and program guidelines change and depend on credit approval, property appraisal, income and asset verification, and other qualifying factors. Not all applicants will qualify. Non-QM, asset-based and business purpose financing carry different pricing, terms and consumer protections than agency financing. Consult your tax advisor regarding the tax treatment of any income or distribution strategy.