Buying your home - Mortgage Approval - Don’t Move Money
Around
When a lender reviews your loan package for approval, one
of the things they are concerned about is the source of funds
for your down payment and closing costs. Most likely, you
will be asked to provide statements for the last two or three
months on any of your liquid assets. This includes checking
accounts, savings accounts, money market funds, certificates
of deposit, stock statements, mutual funds, and even your
company 401K and retirement accounts.
If you have been moving money between accounts during that
time, there may be large deposits and withdrawals in some
of them. The mortgage underwriter (the person who actually
approves your loan) will probably require a complete paper
trail of all the withdrawals and deposits. You may be required
to produce cancelled checks, deposit receipts, and other seemingly
inconsequential data, which could get quite tedious.
To ensure quality control and eliminate potential fraud,
it is a requirement on most loans to completely document the
source of all funds. Moving your money around, even if you
are consolidating your funds to make it "easier," could make
the whole process more difficult.
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