No-Income / Asset-Based Loans

What Is a No-Income Loan?

A no-income loan - also called an asset-based or asset-depletion mortgage - qualifies borrowers using their liquid assets instead of traditional income documentation. No W-2s, no tax returns, no pay stubs, and no bank statement income analysis. If you have substantial savings, investments, or retirement accounts, you can qualify based on those assets alone.

This isn’t a return to the dangerous “no-doc” loans of the pre-2008 era. Modern asset-based loans are regulated, require thorough documentation of assets, and calculate a verified “synthetic income” from your wealth. They exist because millions of financially secure Americans - retirees living off investments, entrepreneurs between ventures, trust beneficiaries, early retirees - have substantial wealth but minimal taxable income that would satisfy a traditional lender.

Asset-based loans are part of the Non-QM family and are available for primary residences, second homes, and investment properties nationwide.

How Asset-Based Qualification Works

The lender converts your liquid assets into qualifying income through a process called “asset depletion.” Here’s how it works:

Step 1 - Total your eligible liquid assets. This includes checking accounts, savings accounts, money market funds, brokerage accounts, and discounted retirement accounts.

Step 2 - Subtract the down payment and closing costs. Only the assets remaining after your purchase expenses count toward qualification.

Step 3 - Divide by the depletion period. The remaining assets are divided over a set number of months - typically the loan term (360 months for a 30-year mortgage) or a shorter period like 60-84 months, depending on the program.

Step 4 - The result is your monthly qualifying income. This synthetic income is used to calculate your DTI ratio, just like traditional income.

Example with 360-Month Depletion

• Eligible liquid assets: $2,000,000
• Down payment + closing costs: $450,000
• Remaining assets: $1,550,000
• Depletion period: 360 months
• Monthly qualifying income: $4,306
• Mortgage PITIA: $3,200 | Other debts: $800
• DTI: $4,000 ÷ $4,306 = 92.9% - May not qualify (DTI too high)

Same Borrower with 84-Month Depletion

• Remaining assets: $1,550,000
• Depletion period: 84 months
• Monthly qualifying income: $18,452
• DTI: $4,000 ÷ $18,452 = 21.7% - Qualifies easily

The depletion period makes an enormous difference. Programs with shorter depletion periods (60-84 months) produce much higher qualifying income but require more total assets. Programs with longer periods (360 months) accept smaller asset pools but produce lower qualifying income. Your lender will match you with the program that fits your asset position.

Eligible Assets

Not all assets count equally. Lenders categorize them based on liquidity and accessibility.

100% Value (Fully Eligible)

• Checking and savings accounts - fully liquid, no restrictions
• Money market accounts - treated the same as savings
• Brokerage accounts - stocks, bonds, ETFs, and mutual funds. Some lenders discount 10-30% for market volatility risk

60-70% Value (Discounted)

• Retirement accounts (IRA, 401k, 403b, Roth IRA) - discounted to account for taxes and potential early withdrawal penalties. Some programs only count retirement assets at full value for borrowers age 59½ or older
• Vested stock options - if they can be documented and valued

Typically Not Eligible

• Real estate equity (unless liquidated into a bank account)
• Business assets, equipment, or inventory
• Cryptocurrency (varies by lender - some accept with significant discounts, most don’t)
• Restricted stock or unvested options
• Cash value of life insurance (some exceptions)

No-Income Loan Requirements

Credit Score

Most asset-based programs require a minimum credit score of 680, with better rates at 720+. These programs attract higher-net-worth borrowers who typically maintain strong credit profiles, so the credit threshold is slightly higher than other Non-QM products.

Down Payment

Expect 20-30% down payment for an asset-based loan. The higher down payment reflects the unconventional qualification method and provides additional security for the lender. Some programs may offer lower down payments for borrowers with very strong asset positions (e.g., assets exceeding 10x the loan amount).

Asset Documentation

You’ll need recent statements (typically the most recent 2 months) for all accounts you want to use:

• Bank statements for checking and savings
• Brokerage statements for investment accounts
• Retirement account statements (IRA, 401k, etc.)

All assets must be verified as liquid and in your name (or jointly held). Assets must be “seasoned” - typically in your accounts for at least 60 days to ensure they’re not recently borrowed funds.

Property Types

Asset-based loans work for primary residences, second homes, and investment properties. Second homes and vacation properties are an especially common use case - retirees purchasing a winter home in Florida or a mountain retreat in North Carolina, for example.

Who Uses No-Income Loans?

Retirees are the most common asset-based borrowers. A retired couple with $2.5 million in investments and retirement accounts but only $4,000/month in Social Security income may not qualify conventionally for the home they want. Asset depletion converts that $2.5 million into qualifying income that reflects their true financial strength.

High-net-worth individuals between jobs - a CEO who sold their company for $10 million and is taking a year off before the next venture. No W-2s, no current income, but massive assets. Traditional lenders can’t help. Asset-based loans can.

Trust fund beneficiaries who receive periodic distributions that don’t fit neatly into “income” categories on a mortgage application. The distributions may be irregular in timing and amount, making traditional qualification difficult even though the borrower has substantial resources.

Foreign nationals with assets in U.S. bank or brokerage accounts but no U.S. income, tax returns, or Social Security number. Asset-based programs designed for international borrowers use passport-based identification and verify U.S.-based assets.

Recently divorced individuals who received a large cash settlement or asset transfer but haven’t yet established independent income. The settlement assets can be used for qualification immediately.

No-Income Loan vs. Bank Statement Loan

Feature	No-Income (Asset-Based)	Bank Statement
Qualification Method	Liquid assets	Bank deposits (income)
Best For	Retirees, between-jobs, high assets	Self-employed, business owners
Min. Credit Score	680	660
Min. Down Payment	20-30%	10-20%
Income Documentation	None	12-24 mo. bank statements
Rates	1-2.5% above conventional	0.5-1.5% above conventional

If you have regular deposits flowing into your accounts from a business or self-employment, a bank statement loan will likely offer better rates and lower down payment requirements. Asset-based loans are best when you have substantial existing wealth but minimal ongoing income - the classic retiree or between-ventures scenario.

No-Income Loan vs. DSCR Loan

If you’re purchasing an investment property, a DSCR loan qualifies based on the property’s rental income and will almost always offer better terms than an asset-based loan for rental properties. Use an asset-based loan when:

• You’re buying a primary residence or second home (DSCR is investment-only)
• The investment property won’t generate enough rent to meet DSCR requirements
• You have strong assets but the property’s rental numbers are weak

How to Apply for a No-Income Loan

Step 1 - Compile your asset documentation. Gather the most recent 2 months of statements for all liquid accounts - bank, brokerage, and retirement.

Step 2 - Estimate your qualifying income. Total your eligible assets, subtract your expected down payment and closing costs, and divide by the likely depletion period. We can run this calculation for you in minutes.

Step 3 - Check your credit. 680 is the minimum; 720+ gets you the best rates.

Step 4 - Get pre-approved. Book a consultation to review your asset position, run the depletion calculation, and determine your borrowing power. We’ll identify the best program for your specific situation.

Step 5 - Find your home. Shop with confidence knowing your asset-based pre-approval is solid.

Step 6 - Appraisal and close. Standard appraisal and closing process - typically 30-45 days from application to keys.

Not sure how much home you can afford? Use our affordability calculator.