You don't need a paycheck to get a mortgage. If you're retired with a healthy nest egg but little traditional income, your savings and investments can qualify you for a home loan on their own. It's called an asset-based mortgage, and it's designed for people who have the money but not the W-2.
Here's the conversation I have often. A retired couple with a seven-figure portfolio, no debt, and great credit wants to buy a home closer to the grandkids. They walk into a bank and get turned down — or offered far less than they need — because their income on paper is just a Social Security check and a modest IRA withdrawal. They could write a check for the house. They just don't want to liquidate their investments to do it.
If that sounds familiar, there's a better way.
How asset-based mortgages work
An asset-based mortgage — you'll also hear it called asset depletion — turns your savings into qualifying income on paper. The idea is simple: your assets are counted as income you could draw on over time, so a lender can approve you without a traditional salary.
Your money stays invested. The calculation just shows the lender you have the resources to comfortably carry the payment. Fairway offers these as part of its flexible financing for borrowers whose assets tell a stronger story than their income on paper — that's how it's described for asset-based loans.
What assets usually count
Most programs look at the same pool of money. Cash in checking and savings accounts, brokerage holdings like stocks and mutual funds, and retirement accounts such as IRAs and 401(k)s are the common eligible items — and Fairway describes asset depletion programs as allowing assets like bank accounts, retirement accounts, or CDs to be considered as qualifying income.
One thing to plan for: money you'll use for your down payment and closing costs comes off the top before the calculation. So you're counting what's left after those.
Who it fits, and what to compare it to
An asset-based mortgage is a strong fit if you're retired or semi-retired with significant savings, you want to keep your portfolio invested rather than pay cash, or you recently sold a business or property and haven't built an income history since.
Before you commit, it's worth a quick look at two alternatives.
A traditional loan using retirement income. Social Security and regular retirement distributions can sometimes qualify you on their own. If it works, it's usually the better-priced option.
A HECM for Purchase. For buyers 62 and older, this reverse mortgage lets you buy a home with no required monthly mortgage payment as long as you live in it and keep up with taxes, insurance, and upkeep. Finance of America notes a HECM for purchase requires no monthly mortgage payments for eligible homeowners.
My job is to lay these side by side so you can pick what fits your plan.
The bottom line
You spent decades building your wealth. You shouldn't have to dismantle it to buy a home. If your savings are strong but your paycheck isn't, an asset-based mortgage or one of the alternatives above can get you where you want to go.
Send me a quick note about what you're hoping to buy and roughly how your assets are held. I'll lay out your options side by side and tell you straight which one fits — and I'm glad to loop in your financial advisor too.
Michael Martin | Fairway Home Mortgage | NMLS #131445
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