Asset-depletion qualifying treats eligible liquid and sometimes retirement assets as a stream of qualifying income under a written formula. It is not “you have cash, so you are approved,” and it is not a cheaper jumbo conventional shortcut you can assume. Snapshot as of 2026-08.
Some agency files have a limited path that converts documented eligible assets into monthly qualifying income under the selling guide. Standalone asset-depletion products with different haircuts, prepayment terms, and employment tests are typically Non-QM. They are not interchangeable.
Three Non-QM conversations (plus an agency cousin)
| Question | Bank-statement | DSCR | Asset-depletion |
|---|---|---|---|
| What typically qualifies the file | Bank-statement programs underwrite from deposits (often 12 or 24 months), typically when tax returns undercount cash flow after write-offs. They still have credit, assets, and property rules. They are not pre-2008 stated income. | DSCR (debt-service coverage) programs typically qualify on the property’s rent versus the proposed payment, not on the borrower’s personal DTI. Occupancy is usually investment. Personal income can still be in the file for other tests. | Asset-depletion (asset-based qualifying) treats eligible liquid and sometimes retirement assets as a stream of qualifying income under a written formula. It is not “you have cash, so you are approved,” and it is not a jumbo conventional shortcut you can assume. |
| Who it is usually a conversation for | Self-employed borrowers whose tax returns undercount cash flow after write-offs. | Investors; occupancy is usually investment. Rent versus the proposed payment. | Typical conversation: substantial eligible assets and thinner documented employment income (for example retirement or high-asset self-employed). If agency W-2 or return income already qualifies, that path is usually more standard. |
If an agency W-2 or return file already qualifies, that path is usually more standard. See the Non-QM hub.
Parent map: Non-QM, bank-statement, and DSCR. If an agency (Fannie, Freddie, FHA, VA, USDA) file can be documented, that path is usually cheaper and more standard. Non-QM is a conversation when agency income calc does not match documentable cash flow or when the property is an investment that the agency stack will not buy.
How the formula usually looks (not an approval calculator)
A common shape is eligible assets, minus funds needed to close and any required reserves, divided by a month count (overlays often use 240 or 360 months). Haircuts on stocks, retirement, and concentrated holdings are typical. This page does not publish a formula you can plug into a blog as an approval.
Investors usually want seasoned, documented assets in the borrower’s name. Business accounts, recently deposited gifts, and non-liquid real estate equity are often limited or excluded. Retirement accounts may count with a haircut if accessible under the overlay.
- Seasoned accounts in the borrower’s name, with statements.
- Subtract funds needed to close and required reserves — those dollars are not also “income.”
- Haircuts on stocks, concentrated holdings, and retirement are common.
- Recently deposited gifts and business accounts are often limited or excluded.
Reserves after cash to close are a separate test: months of PITIA.
Who this is (and is not) for
Typical conversation: substantial eligible assets and thinner documented employment income (for example retirement or high-asset self-employed). If agency W-2 or return income already qualifies, that path is usually more standard.
- Retirement or high-asset files where employment income is thin on paper.
- Not a way to skip occupancy rules on a rental. Occupancy still has to match use.
- Not a substitute for brand-new 1099 income unless the overlay actually uses assets — ask, do not assume.
What happens next
- If agency income already documents, start there. Asset-depletion is the branch when it does not.
- Bring statements, not a net-worth slide. Large deposits still have to be sourced.
- Investment occupancy, if that is the property: investment hub and DSCR vs full-doc.
Common questions
Keep going
What to do next
Education first. A conversation with a loan officer is how you find out what may actually fit your file.
Loan information is provided by Ondo Real Estate (NMLS ID on file). This is not a commitment to lend, a loan approval, or an offer of credit. Rates, terms, and payments shown are estimates for illustration only, are not a quote, and are subject to credit approval, underwriting, and market conditions. You are not required to use Ondo for financing to buy or sell with Ondo. Equal Housing Lender. Program rules, fees, and county loan limits change. Confirm the current published schedule and lender overlays. Nothing here is a quote, a lock, or a credit decision. Licensing and disclosures