Appling for a mortgage application and a letter of explanation for the investigation of 90 days … What can I say?

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  1. Reply
    February 19, 2011 at 1:15 pm

    Tell them the truth. That’s always the best course.

  2. Reply
    February 19, 2011 at 1:42 pm

    Apparently the person applying for the mortgage showed $ 2200 worth of income or down payment funds that were not otherwise accounted for on the financial statement, or that the borrower stated were a gift from someone.

    UCC laws and mortgage/banking policies require very thorough tracking of all transactions over a certain amount, and they want a record of where the $ 2200 is supposed to have come from, not only to report to the IRS for possible tax consequences, but to keep people from laundering funds from criminal activities.

  3. Reply
    Jeromy W
    February 19, 2011 at 2:10 pm

    lenders are becoming much more strict when it comes to verification of income. Thus if they see a large deposit in your bank statement or if you stated that someone will give you x amount to purchase a home, the bank will require proof. Basically if someone gave you this amount of money, all the bank wants is a letter stating that this money was given to you as a gift and repayment is not expected

  4. Reply
    February 19, 2011 at 2:43 pm

    Lenders require verification of funds for the down payment, closing, etc. Most of the time it is required when a relative provides funds to help you purchase a property, i.e. help with a down payment, etc. The lender requires that you provide a letter stating that it was a gift from x-person and is not required to be repaid. The lender will then verify that the funds left the persons, who provided the gift, bank account and was deposited into your account.

    What they are trying to confirm is that it will not have to be repaid so that it does not have to be included in your debt to income ratio.

  5. Reply
    February 19, 2011 at 3:15 pm

    A gift letter is a monetary gift from a relative.

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