Ohio Asset Depletion Loans for Downsizers: Turning Brokerage Accounts into Mortgage Ready Income

How Ohio Mortgage Brokers Can Use Asset Depletion To Qualify Downsizing Borrowers

Across Ohio, a large and growing group of borrowers no longer fit neatly inside traditional income boxes. They have left full time work, sold a business, or shifted from salary to portfolio income. Their tax returns show modest income, yet their brokerage and retirement accounts are substantial. These are the downsizers who want less house, better location, and more lifestyle flexibility, but whose debt to income ratios look weak through an agency lens.

For mortgage loan officers and brokers, this group is tailor made for asset depletion lending through a Non QM Lender. Instead of asking how much a borrower earns from wages, an asset depletion structure asks how much sustainable income their liquid and semi liquid assets can support. When a borrower has a strong portfolio and realistic plans for retirement income, you can convert asset balances into qualifying income without forcing them to liquidate or manufacture taxable distributions just to fit a guideline.

This article focuses on Ohio specific opportunities with asset depletion loans for downsizers, how to position brokerage accounts as mortgage ready income, and how to package scenarios so that NQM Funding can respond quickly with clear terms. Along the way you can rely on tools like Quick Quote for early scenario screening, the Bank Statement and P&L program when business cash flow is part of the picture, the DSCR Page for investment property needs, and the broader Non QM Loans platform to round out your options.

Understanding The Ohio Downsizer Borrower Profile

Who Is Downsizing In Ohio Today

In Ohio, downsizers show up in every metro and many smaller markets. Common examples include couples in Cincinnati trading a large suburban home for a condo closer to the riverfront; long time homeowners in Columbus moving from a five bedroom in Dublin or New Albany into a low maintenance townhome; and empty nesters in Cleveland choosing a smaller single family home in Lakewood, Ohio City, or downtown.

Many of these borrowers have spent decades building retirement and brokerage portfolios. Their net worth may be higher than at any point in their lives, but their W2 income has dropped or disappeared. They may have started part time consulting work, shifted to board roles, or simply chosen to live off savings and investment returns.

From Paycheck To Portfolio

This transition matters because agency guidelines center on stable, documentable income, not on net worth by itself. When a borrower moves from paycheck to portfolio:

Taxable income looks smaller due to strategic planning with CPAs and advisors.

Dividends and interest may be reinvested instead of taken as cash.

Capital gains may be realized irregularly, making year over year comparisons messy.

From a traditional underwriting perspective, that borrower now appears income poor, even though their monthly cash needs are easily covered by savings and investments. Asset depletion loans recognize that this is a documentation mismatch rather than a true affordability problem.

Asset Depletion Loan Basics For Mortgage Brokers

What Asset Depletion Is In Practice

Asset depletion is a method of converting verified asset balances into qualifying income. The lender looks at eligible assets, applies conservative haircuts where appropriate, and divides the resulting figure by an assumed term, often measured in years or months. The result is treated as monthly income for debt to income purposes.

For example, a borrower with one million dollars in eligible brokerage assets might be credited with a portion of that amount as usable income, depending on age and program rules. The key is that you are not asking the borrower to spend down the assets on any particular schedule. You are using them to demonstrate that the borrower has more than enough financial capacity to make the mortgage payments over time.

Types Of Assets That Typically Qualify

While specific guidelines vary, asset depletion programs generally focus on:

Non retirement brokerage accounts holding stocks, bonds, mutual funds, and cash equivalents.

Retirement accounts, sometimes with age based adjustments when the borrower is not yet of distribution age.

Liquid bank accounts and money market funds.

Certain annuities or structured products when documentation supports their stability.

The central questions are liquidity, volatility, and control. Assets that can be converted to cash if needed, that have reasonably predictable value, and that belong directly to the borrower are more attractive in an asset depletion model.

How Asset Depletion Fits Within Non QM Loans

Asset depletion is one tool inside the broader Non QM Loans toolbox. In some files, it stands alone. In others, you may combine smaller streams of traditional income, such as pension or Social Security, with asset depletion income to create a stronger qualifying picture. In more complex cases, you might layer asset depletion with bank statement analysis or DSCR loans on investment properties to build a multi track strategy that reflects the borrower’s full financial life.

Turning Brokerage Accounts Into Mortgage Ready Income

Breaking Down A Sample Brokerage Scenario

Consider an Ohio couple in their early sixties who recently sold a business and moved most of the proceeds into a diversified taxable brokerage account. They live in the Columbus area and want to downsize from a large home in a high property tax suburb into a smaller house or condo closer to the city center.

On paper, their tax returns for the last two years show relatively modest income as they managed the timing of the sale and minimized realized gains. Their W2 income is gone. However, they now have seven figures in non retirement investments, plus modest retirement accounts and cash reserves.

Through an asset depletion lens, you would:

Document the current balances of their brokerage and other eligible accounts.

Apply any required haircuts to account for volatility or retirement status.

Divide the net eligible amount by the program’s assumed term to produce monthly qualifying income.

When combined with their smaller recurring income streams, that calculated income may easily support the payment on a downsized Ohio home, even though tax returns alone would not.

Volatility, Margin, And Concentration

When you review brokerage accounts for asset depletion, pay attention to the quality of the assets, not just the total number. Concentrated positions in a single stock or sector, heavy use of margin, and speculative holdings introduce more risk than a diversified portfolio of mutual funds and bonds.

As a broker, you do not need to be the borrower’s financial advisor, but you should:

Note any large margin balances that reduce net usable assets.

Be ready to explain high concentration in a familiar public company or narrow sector.

Highlight stable, income producing holdings that support long term sustainability.

Your narrative can help a Non QM Lender distinguish between a thoughtful portfolio and a speculative one, which affects comfort with higher loan to value ratios.

Documenting Brokerage Accounts

Clean documentation makes or breaks many asset depletion files. In Ohio, you will often receive statements from national custodians, regional wealth managers, and independent advisors. Make sure that:

Account ownership is clearly in the borrower’s name or in an acceptable trust or entity.

Statements are recent and cover the required historical window.

Transfers and large deposits are explained when needed for seasoning.

If advisors are involved, encourage borrowers to loop them into the documentation process early. That reduces back and forth and positions you as a coordinated part of the client’s financial team rather than a siloed provider.

Comparing Asset Depletion To Other Alternative Documentation Paths

When Bank Statement And P&L Programs Are Better

Some Ohio downsizers are not fully retired. They may have part time consulting income, a small practice, or an online business that continues to generate cash flow. In those cases, the Bank Statement and P&L program can complement or even replace pure asset depletion.

If business cash flow is robust and stable, you might qualify the borrower based primarily on deposits and P&L, using asset depletion as an additional layer of comfort rather than the main income source. This can be particularly useful when brokerage balances are strong but go through temporary volatility.

Using DSCR For Retained Properties

Many downsizers choose to keep their existing home as a rental, or they own other investment properties across Ohio. When that is the case, it may make sense to move those properties onto DSCR loans using the DSCR Page as your product reference. Doing so can free up personal capacity and allow you to focus asset depletion income on the new primary residence.

By separating investment property underwriting from primary residence underwriting, you can create cleaner stories on both sides.

Ohio Specific Context For Downsizing And Asset Based Borrowers

Key Downsizing Markets Across The State

Ohio’s downsizer pipeline runs through multiple metros:

In Columbus, downsizers often move from suburbs like Dublin, Powell, Westerville, or New Albany into smaller homes, condos, or townhomes closer to the Short North, German Village, or other in town neighborhoods.

In Cincinnati, moves frequently involve trading a large home in West Chester, Mason, or Anderson Township for a riverfront condo, a smaller property in Hyde Park, Oakley, or a low maintenance community in the outer suburbs.

In Cleveland, borrowers might leave long held homes in suburbs like Solon, Strongsville, or Mentor to relocate into Lakewood, Tremont, Ohio City, or downtown condos.

Dayton, Toledo, Akron, and smaller cities show similar patterns as retirees and empty nesters prioritize healthcare access, walkability, and community amenities over square footage.

Referencing these local dynamics in your conversations and marketing signals to both borrowers and referral partners that you understand the real downsizing decisions Ohio families are making.

Property Types And Cost Structure

Downsizers often target condos, townhomes, and smaller single family homes. While these may have lower purchase prices than the home being sold, they can introduce different cost drivers, such as HOA dues, downtown parking costs, and changing property tax profiles.

As you structure asset depletion loans, be mindful of:

New HOA fees and how they affect monthly obligations.

Differences in property tax rates between suburbs and urban cores.

Utility savings from smaller homes that may offset some new expenses.

These details help you advise on realistic qualifying levels and monthly payment comfort.

Underwriting Themes For Ohio Asset Depletion Files

Liquidity Versus Net Worth

Non QM lenders care about liquidity at least as much as total net worth. A borrower with a paid off commercial property, an illiquid business interest, and minimal accessible savings is not the same as a borrower with a diversified brokerage portfolio even if their nominal net worth is identical.

When you build an asset depletion file, highlight liquid and semi liquid assets that can support payments if market returns are weak or unexpected expenses arise. Make it easy for credit teams to see that the borrower has both income capacity and a cushion.

Age, Drawdown Risk, And Sustainability

Age and retirement timeline matter because they influence how long a given asset pool must last. A fifty five year old Ohio borrower who plans to work part time for several more years presents a different risk profile than a seventy five year old whose only income sources are Social Security and portfolio withdrawals.

You do not need to provide a full financial plan, but it helps to note:

Whether the borrower is already drawing down assets or simply could do so.

If they have pensions or other fixed income sources that will begin later.

How large their reserves will remain even after accounting for the new down payment and closing costs.

These details show that the mortgage is aligned with a reasonable long term withdrawal pattern rather than draining assets too quickly.

Designing Loan Structure Around Downsizer Priorities

Choosing Fixed Or Adjustable Options

Many downsizers value payment stability. In those cases, a fixed rate Non QM loan that keeps the payment predictable is often attractive, even if the rate is modestly higher than a shorter term adjustable. In other cases, an adjustable structure with a lower initial payment may be appealing if the borrower expects to pay the loan down early or treat it as a bridge between asset allocations.

As a broker, ask how long they realistically expect to stay in the new home, how they feel about payment changes, and whether they view the mortgage as a long term tool or a temporary structure. Then align product selection with those answers.

Balancing LTV With Comfort

Downsizers frequently have the option to put large amounts down from the sale of their prior home. Some will choose low LTV to minimize payments and preserve peace of mind. Others would rather keep more funds invested and accept a slightly higher monthly payment.

Asset depletion gives you flexibility to model different loan to value levels. With Quick Quote, you can show how changes in LTV affect pricing and qualifying requirements, then let the borrower choose the blend of leverage, payment, and liquidity that fits their goals.

Packaging An Ohio Asset Depletion Scenario For A Non QM Lender

Core Documentation Checklist

Before you submit an Ohio asset depletion file, make sure you have:

Recent brokerage and bank statements for all assets you intend to count.

Retirement account statements when relevant, with age and access notes.

Any smaller income documentation, such as Social Security, pension, or part time work.

A short written summary in plain language of how the borrower plans to support payments.

Clean files move faster. Scattered statements and unclear ownership slow things down.

Building A Clear Asset Summary

Credit teams appreciate structure. Create a simple asset summary that lists each account, ownership type, current balance, and any notes about restrictions or volatility. This helps underwriters see the entire picture at a glance instead of hunting through dozens of pages.

You can also call out which accounts you propose to use in the depletion calculation and which are reserves. That level of clarity positions you as a partner in risk management rather than merely pushing for maximum loan size.

Working With Advisors And Building A Referral Engine

Asset depletion deals are natural opportunities to collaborate with financial advisors, CPAs, and wealth managers. When you can explain how an asset based mortgage allows their clients to right size housing without prematurely tapping portfolios, you position yourself as a specialist rather than a generic loan officer.

In Ohio, advisory firms in Columbus, Cincinnati, Cleveland, and other metros are consistently looking for lending partners who understand asset based borrowers. They do not want to send clients through a process that ends with a decline due to outdated income rules. By demonstrating familiarity with Non QM Loans and asset depletion structures, you make it easier for them to recommend you with confidence.

Over time, this turns one off downsizer loans into a recurring pipeline of high quality, well prepared borrowers.

Using NQM Funding To Serve Ohio Downsizers More Effectively

Asset depletion loans give Ohio mortgage brokers a powerful way to say yes to borrowers who have done everything right financially but no longer look good on paper to agency models. When you turn brokerage accounts into mortgage ready income in a thoughtful, documented way, you help downsizers move into homes that match their current lifestyle without forcing them into awkward distribution strategies.

By combining clear local market knowledge with NQM Funding tools like Quick Quote, tapping the Bank Statement and P&L program and DSCR Page where appropriate, and framing each file around sustainable asset use, you build a durable niche in Ohio’s growing downsizer segment. In the process, you become the Non QM Lender partner of choice for advisors, realtors, and affluent clients who simply do not fit traditional boxes anymore.