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What is asset utilization in a mortgage?
Asset utilization is a mortgage qualification method that uses a borrower's eligible assets to help demonstrate ability to repay, instead of relying only on employment income. The lender converts eligible assets into a monthly qualifying figure using the method its program defines. Which assets count, and how, varies by program.
It fits borrowers who have money but not a traditional paycheck: retirees, investors living off a portfolio, or business owners between liquidity events. Eligible assets usually include liquid or near-liquid accounts, with retirement and investment accounts sometimes counted at a discount.
You'll also hear "asset depletion" and "asset-based mortgage." They describe similar ideas, but programs differ in how they calculate income from assets, so the labels aren't interchangeable from one lender to the next.
