Mortgage glossary
Asset depletion
Definition: Asset depletion is a qualifying method that converts a borrower's liquid assets into a calculated monthly income figure, letting people with significant savings but limited paychecks qualify for a mortgage.
The lender takes eligible assets, such as bank, brokerage and retirement accounts, applies any required discounts, and divides the total over a set number of months to create a qualifying income. The borrower does not have to actually withdraw the money. Program rules on eligible accounts and the divisor vary.
Asset depletion is common with retirees, early retirees and people between jobs who hold substantial savings. It is generally offered through non-QM programs. Our non-QM options include asset depletion as well as asset utilization with no DTI and lite documentation.
Related terms
Reviewed by Kyle Richardson, NMLS #863464. General information, not advice for your specific situation. All glossary terms
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