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If not, relax. You may not need to even address it. It could be you just need to delay to the next bank statement cycle, and then have settlement out 45 to 60 days, so you can turn in the second statement. If you are under contract, then you need to document the gift. The potential issue here, if you explain you paid off all of your credit cards (via gift), there better not be anything else marginal about your file. One of the tenants of mortgage loan underwriting is it's taboo to pay off credit cards to qualify. But if the credit report shows 0 balance at the time they run the automated underwriting there's not much they can say......but the file best be squeaky, because that adds fuel to any doubts.
The second issue is, the lender can't stuff the rabbit back in the hat. They've seen the documents and legally cannot dispose of them. If you are not under contract (or are a ways to closing), you may make your life easier may simply moving to someone that hasn't seen the statement.
(By the way, acting too soon after paying off the credit cards is a very common mistake.......your score is not at its best......everyone should wait until the credit card statements are received showing a zero balance before making a move).
If not, relax. You may not need to even address it. It could be you just need to delay to the next bank statement cycle, and then have settlement out 45 to 60 days, so you can turn in the second statement. If you are under contract, then you need to document the gift. The potential issue here, if you explain you paid off all of your credit cards (via gift), there better not be anything else marginal about your file. One of the tenants of mortgage loan underwriting is it's taboo to pay off credit cards to qualify. But if the credit report shows 0 balance at the time they run the automated underwriting there's not much they can say......but the file best be squeaky, because that adds fuel to any doubts.
The second issue is, the lender can't stuff the rabbit back in the hat. They've seen the documents and legally cannot dispose of them. If you are not under contract (or are a ways to closing), you may make your life easier may simply moving to someone that hasn't seen the statement.
(By the way, acting too soon after paying off the credit cards is a very common mistake.......your score is not at its best......everyone should wait until the credit card statements are received showing a zero balance before making a move).
Not under contract...haven't even been pre-approved which is why I'm asking my question. If we wait until 60-days out to get pre-approved and the deposit doesn't show up on our statements should we be okay and not have to explain anything? No one has seen our statements yet. And the credit bureaus have already reported our lower balances so our credit scores are where they need to be. My biggest concern is going to get pre-approved and them asking for more than 2 months of statements, seeing the large deposit and us having to then document it, potentially opening a can of worms.
Not under contract...haven't even been pre-approved which is why I'm asking my question. If we wait until 60-days out to get pre-approved and the deposit doesn't show up on our statements should we be okay and not have to explain anything? No one has seen our statements yet. And the credit bureaus have already reported our lower balances so our credit scores are where they need to be. My biggest concern is going to get pre-approved and them asking for more than 2 months of statements, seeing the large deposit and us having to then document it, potentially opening a can of worms.
I think if your income is sufficent to qualify for the mortgage you are wanting to be approved for you should still be fine. They will probably ask for some documentation and signed explanation letters but as long as you are well within your debt to income ratios and don't have any other questionable financial issues you should get the approval.
You could wait as little as 30 days, you should be fine. Let's say the money was put in on 2/5/2013 and your statement cut off on 2/18/2013. Supply the statement for 2/19 forward, and then the 3/19 statement and the 4/19 statement. Toss the one with the gift.
If your lender can't work with you, go find another. The only one obligated not to stuff the rabbit back is the UW. Where I work, the loan officer is the buyer's advocate and figures out how to make the loan work within the guidelines. If this is not what you are seeing, go find it.
Dont spend it all yet. If it was over $13k, you will likely have to pay a good amount of taxes on it. If you ignore it, and dont pay the IRS, you may get a letter 3 years later, or more asking for the money. They wont catch it right away, but they will catch it.
True, but incomplete. Dad can gift $13k per year to son, and another $13k to daughter in law. Then mom can gift $13 k to son, and another 13k to daughter in law.
Or dad can deduct the entire amount of the gift from his lifetime estate exemption (currently at 5 million.)
You are correct - IRS will find it and the grantor(s) of the gift need to file the forms with their tax returns for that year to avoid penalties.
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