Documenting Your Assets and Verifying Your Down Payment

When purchasing a home the mortgage loan process requires you to verify personal information which includes your assets. Lenders will require providing supporting documentation of where your source of money is coming from.  Money cannot mysteriously appear in an account. You must have a veroifiable source for your downpayment. The only exception to this condition is a “no assets" loan  verification program. In order to meet underwriting guidelines your loan officer will require you to provide this information. Lenders require this condition be met as a form of quality control against fraudulent loan activity. The most important thing is to make sure you qualify for the loan amount you're requesting.  

A savings account such as a basic savings, mutual or money market account is the best form of verification. Providing this information makes the lender feel more confident about your strength as a borrower. This money should not be a sudden lump sum deposit into your account. There should be a history of deposits over a period of time.  Your savings history provides proof of your responsibility and stability as a potential borrower.  Verifiable assets will increase your strength as a borrower. If you can verify additional assets beyond the funds necessary for the down payment you should include this information. These assets are looked upon as "cash reserves" you can draw upon during times of an unexpected occurrence or personal emergency such as unemployment or medical emergency. The additional assets will further document you have a history of saving money. This will support your loan application and portray you as a more responsible borrower.

It is very important to establish a documented history of any funds you use for down payment and closing costs. This along with good credit will help you qualify for the best loan products. It will also make the loan process much easier for you.