Asset Related Questions
Can I use cash deposits?
Cash deposits can rarely be used for any loan application purpose. This includes cash received from friends, family or the sale of items you had, or cash you have kept at home and plan to deposit back into your account. You can however take the cash you have on hand and pay bills by money […]
Can I take a cash advance on my credit card?
No. Cash advances may not be introduced into any of your accounts as an acceptable source of down payment. You can use the cash advances to pay other budget items but not your current rent or mortgage. You cannot deposit the cash advance into the account that is holding your funds for down payment, regardless […]
Can I deposit checks from sources other than my payroll check into my account?
No. Checks coming from friends, family or other sources that are not your own earned money or already saved funds cannot be used. For example, if your best friend writes you a check to reimburse you for dinner the other night, you cannot count this money in your account that holds your down payment. Checks […]
What about transfers into my account from another account?
If the transfers are from another account that you own, we can use it by documenting 60 days of history including deposits on the transfer account. A joint account held with someone else can be acceptable as well, with a letter from the joint holder that use of the funds is acceptable to them. If […]
What do I do if I have already received money in my account?
We will need to see a copy of the check you deposited, and will need a letter of explanation about the source of the money. Occasionally, that letter would have to be written by the person/entity that provided the check. You can usually get a copy of this check off your online banking system. If […]
What other things does the lender look for on account statements?
Lenders are frequently reviewing checking account statements for a pattern of overdrafts that would indicate that you are not managing your money well. Frequent overdrafts and/or NSF charges can be a red flag to the lender and could affect your loan approval. Additionally, if you have an ongoing balance and are using your overdraft line […]
When do I need to have my down payment?
Ideally, when you write your offer, your funds should be ready. Funds could be in the form of a gift, the sale of another property, or money you have already saved. We will document these with a gift letter, the contract for the property sale, and bank statements to show you have funds ready for […]
What is required for gift documentation?
Your loan originator will prepare and assist you in getting the documentation for a gift that is acceptable for the lender. Do not prepare your own gift letters as they may not be approved by the lender. Generally, for gift documentation, the donor will sign a gift letter indicating the funds do not need to […]
My agent is writing my offer this afternoon and I forgot my checkbook. Can my girlfriend (or mom or brother or friend) write the earnest money check for me and I can pay them back?
No. This is not recommended because it likely is not an acceptable source of your down payment. Ask your agent to let you bring your own check later for the offer to be submitted.
I don’t have enough money in my account for my earnest money. Can I write a check from my credit card account?
No. This is never an acceptable source for the earnest money.
Will my earnest money count toward my down payment?
Yes. You will receive credit for the earnest money to be applied toward your down payment.
Do I always get my earnest money back if I don’t purchase the home?
Usually but not always. You would get the money back if you cancel the contract by the dues dates for various options you have built into the contract. Generally, these are for the condition of the property, acceptable title, appraised value, and loan approval. If all these conditions dates are passed, and you change your […]