Enter the values of your assets (such as stocks, bonds, real estate, etc.) into the calculator to determine your potential mortgage eligibility.

Asset Based Mortgage Calculator

Enter any 2 values to calculate the missing variable

Related Calculators

Asset Based Mortgage Calculator Formula

The following equation is used to calculate the Asset Based Mortgage estimate based on your assets portfolio.

ABM = (ΣA) × LR
  • Where ABM is the estimated asset-based mortgage amount ($)
  • ΣA is the sum of all applicable assets ($)
  • LR is the loan ratio (expressed as a decimal)

To estimate the mortgage amount, sum all of the relevant assets you’re including and multiply by the loan ratio your lender applies for asset-based loans.

What is an Asset Based Mortgage Calculator?

Definition:

An Asset Based Mortgage Calculator helps individuals or entities estimate their mortgage qualification and potential loan terms based primarily on the value of their assets rather than just income or credit score. These assets could include investments, real estate holdings, or other valuable property.

How to Calculate an Asset Based Mortgage?

Example Problem:

The following example outlines the steps and information needed to calculate an estimated Asset Based Mortgage.

First, determine the value and types of assets you wish to include. In this example, let’s say you have $150,000 in real estate equity, $100,000 in stocks, and $50,000 in bonds, for a total asset value of $300,000.

Next, determine the loan ratio (LR) your lender offers. In this example, let’s say the ratio is 75% (0.75 as a decimal).

Finally, calculate the mortgage estimate using the formula above:

ABM = (ΣA) × LR

ABM = $300,000 × 0.75

ABM = $225,000

FAQ

Why would someone choose an asset-based mortgage over a traditional mortgage?

Asset-based mortgages can be ideal for individuals whose income might not clearly reflect their ability to repay a loan — for instance, retirees, seasonal workers, or high-net-worth individuals with the majority of their funds in investments rather than earned income. By focusing on the value of assets, lenders can gauge a borrower’s financial standing even if their traditional income is less stable.

What types of assets can typically be used for qualification?

Lenders often consider a range of assets, including cash, stocks, bonds, mutual funds, retirement accounts, and real estate equity. The exact list depends on the lender’s requirements, and some assets might be discounted or excluded based on their liquidity and stability of value.

Does a higher loan ratio always mean a higher mortgage amount?

Yes, generally speaking, a higher loan ratio (LR) will increase the estimated mortgage amount, assuming the total asset value (ΣA) remains constant. However, a higher LR can also come with stricter terms or higher interest rates, so it’s important to weigh the benefits against the potential added costs.