Mortgage Asset Depletion Calculator

Asset-depletion qualifies high-net-worth borrowers without W-2 income via assets.

Total liquid assets

Retirement accounts

Retirement haircut %

Qualifying months

Monthly qualifying income

$17,167

Annual qualifying income

$206,000

Total qualifying assets

$2,060,000

How the math works

Qualifying assets = liquid + retirement × (1 − haircut). Income = assets / qualifying months.

$1.5M + $800k × 70% = $2.06M / 120 = $17,167/mo qualifying = $206,000 annual income.

How to Use

Enter total liquid assets.
Enter retirement accounts.
Enter retirement haircut %.
Enter qualifying months.
Read monthly qualifying income.

Frequently Asked Questions

Asset depletion formula?

Liquid assets (cash, brokerage, retirement) divided by qualifying period (60–360 months) = qualifying income. Non-QM lenders typical: 60 months for retirement-age, 84–180 for younger borrowers. Conventional limits: 360 months for retirement, longer for younger. Eligible assets: cash, stocks, bonds, mutual funds, IRA/401k (haircut 70–80% pre-retirement). Excluded: real estate, business interest, illiquid. Best for: retirees, business owners with low W-2, executives with stock comp, trust beneficiaries.

How does this debt analysis fit a workout strategy?

Workout, default, and recapitalization decisions depend on the gap between in-place debt and current asset value. Lenders evaluate cure cost, foreclosure timeline + cost, broker price opinion (BPO), and borrower equity. Borrowers evaluate equity in the property, refinance feasibility, and forbearance economics. This calculator provides one input to that multi-factor decision.

Discounted payoff (DPO) vs forbearance vs deed in lieu?

DPO: lender accepts less than full balance to avoid foreclosure cost, common with non-recourse and underwater assets. Forbearance: payment deferral 6–18 months, balance accrues, useful when value will recover. Deed in lieu: borrower transfers title to lender, faster than foreclosure but lender takes full risk. DPO often best when borrower has new capital + lender wants quick exit.

Special servicing dynamics?

CMBS loans transfer to special servicer at default or maturity default. Special servicer compensation aligns with workout, but timeline is 6–24 months and fees stack ($25–250k+ in costs). Whole-loan and balance-sheet lenders move faster but with less flexibility. Bridge and debt fund lenders most flexible. Time-to-resolution and total friction cost should be weighted in any borrower scenario.