Which Non-QM loan type uses monthly payments derived from available assets?

Prepare for the Qualified and Non-Qualified Mortgage Test with comprehensive flashcards and multiple-choice questions. Ensure you understand every concept with detailed hints and explanations.

Asset-depletion loans qualify a borrower by turning available assets into a projected monthly income. Lenders apply a depletion factor to the asset balance and convert that into a monthly figure to determine the debt‑to‑income qualification. This approach is designed for borrowers who have substantial assets but little or irregular earned income, so their ability to support payments is shown through assets rather than paycheck income.

In contrast, bank statement loans rely on cash flow shown in bank deposits to estimate income, not directly from the asset balance. Stated income involves income the borrower declares without full verification, and conforming loans follow standard guidelines using documented income and employment history. Therefore, when monthly payments are derived from assets, the asset-depletion method is the correct fit.