If you’ve ever tried to get a traditional mortgage while self‑employed or living off investments, you know the drill: endless paperwork, weird questions about every dollar, and underwriters who act like your tax return is a crime scene.
That’s where asset only and stated income mortgage loans come in—they’re built for people whose finances are solid but don’t fit neatly into a W‑2 box.
Let’s walk through exactly how to use these loans without derailing your workday. Table of Contents
- 1. Step 1: Understand If Asset Only
- 2. Step 2: Choose Between Asset Only
- 3. Step 3: Prepare Your Assets, Docs,
Key Takeaways Key Point
Why It Matters What To Do Asset only and stated income mortgage loans are built for non‑traditional earners
You don’t need perfect W‑2s or simple tax returns to qualify Map your income type (self‑employed, investor, commission) to the right loan structure Lenders still verify ability to repay, just in different ways
You can’t just “make up” income and hope it sticks Organize bank, brokerage, and retirement accounts and be ready to document source of funds Rates, costs, and down payments vary a lot between programs
A slightly higher rate can still be a win if it lets you buy or refinance strategically Have your loan officer model 2–3 scenarios and compare total costs over 5–10 years
1. Step 1: Understand If Asset Only
and Stated Income Mortgage Loans Fit Your Situation Let’s start with the obvious question: are asset only and stated income mortgage loans actually a good fit for you, or do you just hate paperwork? These loan types are designed for people whose finances are strong, but their tax returns make them look broke—think business owners writing off legitimate expenses, sales pros with big bonus swings, or investors living off distributions and capital gains. If a conventional lender keeps saying “your debt‑to‑income doesn’t work,” even though your bank and brokerage accounts look great, this is your lane. How to Refinance Mortgage to Lower Rate or Cash Out: Step‑by‑Step Guide for Busy Professionals] With an asset only mortgage, the lender focuses heavily—or sometimes almost entirely—on your assets instead of your traditional income.
They’ll look at your cash, investment accounts, retirement funds, and maybe even business accounts to see if you’ve got enough cushion to support the new mortgage payment for a given period.
Stated income mortgage loans, on the other hand, let you state your income on the application without having to back it up with full tax returns the way a conventional loan would.
You still need to be reasonable and verifiable by alternative means, but it’s way more flexible. FHA vs Conventional Loans: Step‑by‑Step Guide to Choosing the Right One] So who’s the classic candidate?
Picture a 45‑year‑old consultant in Austin who writes off home office expenses, travel, and half their life through an LLC. Their tax return says they “make” $65K. Their actual cash flow?
More like $200K+, with six figures sitting in a brokerage account. A traditional lender may struggle with that scenario.
Asset only and stated income mortgage loans say, “Okay, show me the real story via bank statements, assets, and a reasonable stated income.” That’s why these programs exist. Mortgage Process Step by Step: The No‑Stress Guide for Busy Professionals] Before you go all‑in, you still want to compare them to regular FHA or conventional loans.
If you suspect you might squeeze into a traditional mortgage with smart planning, it’s worth checking out guides like “FHA vs Conventional Loans: Step‑by‑Step Guide to Choosing the Right One” over at Casey Sullivan Mortgage.
Sometimes, a little restructuring plus a couple of extra documents can get you a standard loan with a lower rate.
Other times, the non‑QM route (non‑qualified mortgage, which includes many asset only and stated income options) is clearly the better move for your situation. The Smart Professional’s Guide to Mortgage Options in All 50 States
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You’re self‑employed with heavy write‑offs
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Your income is commission‑based or bonus‑heavy
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You’re semi‑retired and living off investments
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You own multiple rental properties with complex taxes
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You’ve got strong assets but messy tax returns
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List your income sources: W‑2, 1099, K‑1s, distributions, rental, etc.
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List your major liquid assets: checking, savings, brokerage, retirement accounts.
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Pull your last two years’ tax returns and see what your “taxable” income actually shows.
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Note any big one‑time events (business sale, large bonus, stock vesting) that don’t repeat.
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Talk with a loan officer to match your profile to either asset only, stated income, or a hybrid.
Profile Type
Common Problem With Traditional Loans Why Asset Only / Stated Income Might Help Self‑Employed Consultant
High write‑offs make taxable income look low Assets and cash flow can be used instead of pure tax return income Commissioned Sales Pro
Income swings year‑to‑year; underwriters average it down Stated income can better reflect current earning power with supporting docs Retiree / FIRE Investor
Low W‑2 income but high assets and investment income Asset only programs can qualify based on reserves and asset draw‑down Real Estate Investor -
Complex returns, multiple properties, hard‑to‑parse expenses Alternatives like asset based or DSCR loans reduce tax‑return dependence
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Pro tip: If your tax returns are still mid‑preparation, loop in your CPA and your loan officer to gether. A few strategic choices on write‑offs can dramatically change which loan options—especially asset only and stated income mortgage loans—are available to you this year versus next.
2. Step 2: Choose Between Asset Only
and Stated Income (or a Hybrid) the Smart Way Once you’re pretty sure you’re in the right ballpark, the next move is figuring out which flavor works: pure asset only, stated income mortgage loans, or some mix. They sound similar, but they solve slightly different problems. Asset only focuses on the pile of money you’ve already built.
Stated income focuses more on what you’re earning now (or reasonably expect to earn), but lets you skip the usual tax‑return gymnastics. Team-Based Mortgage Planning With Realtor and Financial Advisor: The Smarter Way to Buy a Home] Here’s the basic logic.
If you’ve got a strong asset base—say, $500K in investments and cash—but inconsistent or hard‑to‑document income, asset only is your friend.
The lender might say, “If your payment is $4,000/month and you have enough assets to cover several years of payments, we’re comfortable.” If your assets are decent but not huge, and your true income is solid but your tax returns don’t show it cleanly, stated income mortgage loans might be better.
You’ll state a realistic income number, and the lender will verify it through bank statements, letters from your CPA, or other alternative documentation. VRBO and Short Term Rental Financing: How to Turn Weekend Guests into Long-Term Wealth] There are also hybrid approaches.
Some programs blend bank statement analysis with stated income or use a percentage of your assets as an "imputed" income stream.
The key is not to chase the lowest rate in the abstract, but to pick the structure that matches your real financial story with the least friction.
That’s where a lender who does this every day—like the Casey Sullivan Mortgage team—earns their keep.
And just to zoom out for a minute: if you feel like you’re choosing between 20 different weird acronym loans, you’re not alone.
It can help to check out “The Smart Professional’s Guide to Mortgage Options in All 50 States.” It walks through the broader landscape—FHA, VA, jumbo, non‑QM—so you can see where asset only and stated income mortgage loans fit in the bigger picture for your long‑term plans.
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Asset only mortgages work best with big, verifiable liquid or semi‑liquid assets.
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Stated income works best when your true income is strong but messy on paper.
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Hybrid or bank‑statement loans can bridge the gap if you have both decent assets and decent cash flow.
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The more flexible the documentation, the higher the rate and down payment usually are.
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Estimate your total liquid and semi‑liquid assets (cash, brokerage, vested stock, retirement).
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Estimate your realistic monthly income, not just what shows on your taxes.
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Ask your lender for 2–3 scenarios: asset only, stated income, and a traditional or bank‑statement option.
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Compare each scenario’s payment, rate, and cash to close—not just the rate.
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Pick the structure that fits both today’s needs and your 5‑year plan (buying more properties, refinancing, etc.).
Feature: Asset Only Mortgage
Stated Income Mortgage Traditional Conventional/FHA Primary Basis for Approval
Assets and reserves
Reasonable stated income plus alternative verification Tax returns, W‑2s, pay stubs Best For
High‑net‑worth, inconsistent income, retirees
Self‑employed, commission, high write‑offs W‑2 earners, simple tax returns Documentation Level
Low to moderate, heavy on asset statements
Moderate, bank statements and letters High, full income and tax docs Typical Rate vs Conventional
Slightly to moderately higher
Slightly to moderately higher Generally lowest available Down Payment Requirements
Usually higher (e.g., 20%+)
Often 10–20%+ depending on program Can be as low as 3–3.5% with certain programs
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Pro tip: When comparing asset only and stated income mortgage loans, don’t obsess over a 0.125% rate difference.
Focus on total cost over the period you’re likely to keep the loan (often 5–7 years), plus how quickly each option gets you the house or investment you actually want.
3. Step 3: Prepare Your Assets, Docs,
and Numbers Like a Pro Now we’re getting into the part everyone loves. paperwork. The good news is that asset only and stated income mortgage loans generally mean less of it than a traditional loan, but you still want to be organized so the process doesn’t drag out. The lender isn’t trying to make your life miserable; they just need to show a regulator that you have the ability to repay.
So, help them help you.
Start with your assets.
For an asset only structure, lenders typically want recent statements for all relevant accounts—checking, savings, money market, brokerage, retirement, and sometimes even business accounts.
They’ll look at balances, recent large deposits, and whether funds are seasoned (sitting there for a while) or just appeared overnight.
For stated income mortgage loans, assets still matter, but we also care about showing that the income you’re stating is believable given your activity—so clean, consistent bank deposits are your friend.
Let’s talk about what not to do.
Don’t move money all over the place right before you apply.
Huge transfers from random accounts or friends will create questions and slowdowns.
Don’t deposit large amounts of cash with no paper trail two weeks before you start the loan.
And don’t blend business and personal funds more than necessary; it just makes the underwriter grumpy and your file messy.
If this all sounds like a lot, there’s a reason many busy professionals appreciate a more guided, team‑based approach.
Casey Sullivan Mortgage literally has a post titled “Mortgage Process Step by Step: The No‑Stress Guide for Busy Professionals” that aligns really well with what we’re talking about here.
Combine that with a quick call to your CPA or financial advisor, and you’ve basically got a mini task force handling this while you stay focused on your business.
