Own Luxury Homes®
Asset Depletion Mortgage — Qualify on Wealth, Not Income
Asset depletion calculates qualifying income from liquid assets: $3M ÷ 360 months = $8,333/month regardless of reported income. Retirement accounts count at 70% of face value. The down payment and closing costs are subtracted before the calculation. Ideal for high-net-worth buyers with $1.5M+ in documented savings or investment wealth but minimal current reported income. The OLH Self-Employed Buyer Framework™ identifies asset depletion lenders at the luxury price tier before any property search begins.
Home → Markets → Self-Employed → Asset Depletion Mortgage — Qualify on Wealth, Not Income
Asset Depletion Mortgage — Qualify on Wealth, Not Income
$0
Additional taxes triggered by pledging assets as loan collateral vs liquidating them
100%
Percentage of non-cash depreciation deductions added back to qualifying income by lenders
25%
Ownership threshold above which lenders require full business income analysis, not just W-2 salary
5
Self-employment-specific verification dimensions added to the standard OLH Integrity Audit
Asset depletion allows lenders to calculate a monthly qualifying income from the borrower's liquid assets — dividing the documented asset balance by the loan term (typically 360 months for a 30-year mortgage). A buyer with $3M in liquid assets qualifies for $8,333/month in income ($3M ÷ 360) regardl...
Own Luxury Homes® NAMED CONCEPT
OLH Self-Employed Income Analysis Protocol™
The Own Luxury Homes® pre-application income analysis for self-employed buyers: S-corp W-2 plus K-1 ordinary income calculation, Schedule C net profit with depreciation add-back, bank statement deposit averaging with actual expense ratio, and asset depletion calculation — presented to the target lender before any application is submitted to confirm the qualifying income that will be used in underwriting.
OLH Market Intelligence Analysis, May 2026.
How Asset Depletion Income Is Calculated
The asset depletion calculation: (1) Document all eligible liquid assets. (2) Apply the asset discount (retirement accounts are typically counted at 70% of face value to account for income tax on withdrawal; other accounts at 100%). (3) Subtract the down payment and closing costs (the assets that will be spent at closing are not available for depletion). (4) Divide the remaining eligible assets by the loan term in months (360 for a 30-year mortgage, 180 for a 15-year). (5) The result is the monthly qualifying income from asset depletion. Example: $3M in eligible assets after discounts and down payment ÷ 360 months = $8,333/month. At 43% DTI: $8,333 × 43% = $3,583/month available for housing (mortgage payment + property tax + insurance + HOA). At 7% rate: supports approximately $450,000 in mortgage.
Which Assets Count for Asset Depletion
Eligible assets for asset depletion: checking and savings accounts (100% of balance), money market accounts (100%), brokerage/investment accounts (100% of documented value), retirement accounts: 401K, IRA, SEP-IRA, SIMPLE IRA (typically 70% of balance to account for taxes and early withdrawal penalties for borrowers under 59½; some lenders use 80% or 60% — confirm with the specific lender), trust accounts (100% if the buyer is the trustee or beneficiary with control). Assets that typically do NOT count: business accounts (not personal assets), real estate equity (not liquid), vehicles, art or collectibles, cryptocurrency (varies by lender — some accept, most don't), restricted stock or unvested equity (not yet liquid).
Asset Depletion for the High-Net-Worth Self-Employed Buyer
Asset depletion is particularly valuable for self-employed buyers in these situations: (1) The business is young (under 2 years) and conventional documentation is not available, but the buyer has accumulated investment or savings wealth from a prior career. (2) The buyer's income has been optimised heavily for tax purposes, producing very low taxable income despite significant business success, and substantial wealth has accumulated in investment accounts. (3) The buyer recently sold a business and has significant liquid proceeds but limited current income. (4) The buyer is transitioning between businesses (winding down one, starting another) and has a gap in documented income that would disqualify them conventionally. In all cases, the buyer needs substantial documented liquid assets — typically at least $1.5M–$2M to support a $1M+ mortgage on an asset depletion product alone.
Combining Asset Depletion With Other Income
Asset depletion income can be combined with other qualifying income on the same mortgage application. Example: a self-employed buyer with $100,000 in bank statement qualifying income and $1.5M in investment assets can combine: bank statement income ($8,333/month) + asset depletion income from $1.5M ÷ 360 ($4,167/month) = $12,500/month total qualifying income. This combined approach produces substantially higher qualifying income than either source alone. The lender must offer a product that allows combining income types — some non-QM lenders specifically offer this flexibility. The OLH-verified specialist identifies lenders who offer combined income documentation products at the luxury price tier.
Asset Depletion vs Other Products: When It Wins
| Buyer Situation | Best Product | Why Asset Depletion Wins |
|---|---|---|
| Recent business sale, $5M+ liquid, low current income | Asset depletion | $5M ÷ 360 = $13,889/mo — exceeds most income |
| High W-2 income professional | Conventional | Asset depletion not needed — income qualifies |
| Self-employed, strong bank deposits | Bank statement | Deposits may produce higher income than asset depletion |
| Recently retired, significant portfolio | Asset depletion | No income documentation needed |
| Career transition, gap in income | Asset depletion | Bridges the income gap during transition |
| Crypto holder, liquid post-conversion | Asset depletion or conventional | Depends on liquidation proceeds vs income |
OLH Self-Employed Buyer Framework. Individual qualification depends on credit, property, and lender guidelines. Product recommendation requires full income and asset assessment.
“The income calculation for a self-employed buyer is the most mishandled part of the transaction — by agents, by lenders, and often by the buyers themselves. A business owner who took $180,000 in bonus depreciation in the last tax year looks on paper like they earned $270,000 when they actually generated $450,000. The lender who doesn’t add back the depreciation correctly will decline a buyer who should qualify. The specialist we introduce knows which lenders perform this analysis correctly, because they’ve placed self-employed buyers with those lenders before and seen the add-back applied correctly at the underwriting stage — not just claimed in the pre-qualification conversation.”
— Ryan Brown, Principal Broker & CEO
Own Luxury Homes® · FL BK3626873 | NAR 624500541 | USPTO 7968024
407-900-7030 · ryan@ownluxuryhomes.com
Related Self-Employed Buyer Guides
- Self-Employed Mortgage — Complete Guide
- Bank Statement Loan Guide
- S-Corp Owner Mortgage
- Asset Depletion Mortgage
- OLH Self-Employed Specialist Verification
FAQ
How much do I need in assets to use asset depletion?
To support a $1M mortgage on a 30-year term at 43% DTI, you need monthly qualifying income of approximately $3,500+/month (at current rates). At $3,500/month: $3,500 × 360 months = $1,260,000 in eligible assets after the down payment and discounts. A $1M mortgage with a 20% down payment means the buyer already deployed $250,000 from assets — so total eligible assets needed before the down payment would be approximately $1,510,000. For larger mortgages or higher rate environments, the asset requirement scales proportionally.
Does asset depletion require me to actually liquidate the assets?
No. Asset depletion is a calculation methodology — it determines qualifying income based on what the assets could produce if depleted over the loan term. The buyer does not need to actually draw down the assets. They remain invested. The lender simply uses this methodology to establish an income equivalent from the asset balance.
Can I use retirement accounts that I can't access without penalty?
Yes, but at a discount. Most lenders count retirement accounts (401K, IRA) at 70% of face value to account for the 10% early withdrawal penalty (for buyers under 59½) and the income taxes that would be due on withdrawal. If you are over 59½, some lenders use 80% or 100% since the early withdrawal penalty no longer applies.
What if the assets are in a business account or entity?
Business accounts and entity-held accounts generally do not count for personal asset depletion. The assets must be personal assets that the buyer owns and can access. Business assets — even from a wholly-owned business — are typically excluded because the lender cannot verify the buyer's personal access to and control over those assets for personal mortgage purposes.
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"The introduction Own Luxury Homes® makes is to a specialist with documented closing history in your specific market — not the county, not the metro, the submarket you're actually selling or buying in. That's the standard we verify before your name goes anywhere."
— Ryan Brown, Principal Broker & CEO, Own Luxury Homes® (FL License BK3626873)