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heres the situation. I intend on asking the LO, but thought Id ask here now, because obviously it is after hours. I am in the final stages of purchasing a home(fha) . a couple of weeks ago, I made a deposit of 1600 into my checking account. this came from my gf, who lives with me. it was money she was saving . she didnt have it in an account, just here at home. I only made this deposit because I was worried about " reserves". what is going to happen?? there obviously is not any papertrail. is the whole dream going to be blown just because of this? the loan had already gone through underwriting and all that jazz.they needed my last statement which had that deposit.
I just know im screwed! what should I say to the LO tomorrow? thanks in advance
Well, I'm not a LO, but no one has replied yet, so I'll offer any info I've had from experience.
Are you buying the home together? Is that money going toward the down payment? Will she be taking that money back? If you can offer more info about the deposit and your concerns, hopefully someone can help...
not buying the house together, was not using it for the downpayment, my mother gifted me money for that. I thought that the 1600 was going to be used for that until my mom offered me the money.
This will not be a huge issue. You might have to write a letter of explanation about the deposit; however, if you just deposited, and have already submitted bank statements this may not be an issue. Worst case you will not be able to use the $1600 as assets. This isn't a deal killer.
I had a bunch of questions regarding this because I had made a large deposit severals months before closing.
Like Victor said, you might be required to get your girlfriend to type up a quick letter saying she gave you that money and you might not be able to touch it to pay towards the house. Essentially they may force you to act like it's not even there. Not saying you can't use it after closing to remodel or things along those lines.
You should be fine. Get it straightened out ASAP so you don't have it weighing on you.
I think the concept of "large deposit" tends to scare some people because lenders do not really explain what they mean by this.
The most obvious class of "large deposit" is something that is so big it looks like the down payment all by itself. This scares the crap out of lenders because it has the potential to be another loan. Any loan for the down payment could legally be construed to be a lien against the title and that would threaten the primary collateral of the loan.
The second most obvious class of "large deposit" is anything that triggers the Dept of Treasure watches. The government needs to have large deposits reports to track any attempt to launder money for purposes of funding terrorism, furthering a criminal enterprise (like the drug trade) or evading taxes. Any financial services company (and even some retail businesses) can get tripped up by this and home buying is one of the ways that people COULD potentially move lots of money around to evade the authorities.
The third class of "large deposits" is something that would indicate that the information obtained through the credit reporting agencies is not really representative of the borrowers true behavior. Lenders trust that the money used to pay debts come from the sources of legitimate income borrowers disclose. The further assume that debts reported to the credit agencies are the only ones the borrower is responsible for. If the borrower has "a secret life" that they are only merging long enough to get a loan that they really cannot afford they will cancel the deal.
That last class is the most vague, and when the lenders were at their most paranoid was most often cited (though obliquely) as the need for "additional documentation". Even in such cases the "large deposit" was USUSALLY not something that might have been extra paycheck that may have been stuck to the fridge behind a calender or some cash from a pal (the way this $1600) dollars was, but something that looked more like either the winning from a race track that turned out to be the sale of deceased relatives car (which is typically also over the $10,000 Treasury trigger...).
SO in summary: BE COOL. This is NOT the kind of thing that will blow your deal. If you do bet on the ponies or sell grandma's Rolls Royce just hold off on THOSE kind of deposits and everything will be fine!
I agree with Victor. This happened to us LOTS (as for "large deposit" meaning REALLY suspicious, not necessarily-- they thought our PAYCHECKS were odd and we had to prove what they were, for cryin' out loud). Anyway, you might not be able to count that money towards your assets/down payment, but if you weren't planning to/needing to, then it doesn't matter anyway.
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