balance transfers for deposit on house?

[SantaMar]

i have the ability to purchase a home for extremely cheap!  title companies will not allow me to close with a credit card.  there is a good funds law that prevents that...however...can i use a balance transfer check, deposit into my personal checking account and cut a check from my personal checking account for a percentage of the down payment? 

does the credit card company care how i spend the balance transfer money?  if i am elegible for a 8k balance transfer with 0% until next may....can i deposit those access checks in my personal account or even use those access checks for closing?? 

[sillykitty1]

The mortgage company will verify where your funds came from.  You will need to provide your deposit statements, and copies of checks deposited.  It will become obvious it was a balance transfer and those funds will not be allowed to used for the home purchase.

[n0smirc]

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@SantaMar wrote:

i have the ability to purchase a home for extremely cheap!  title companies will not allow me to close with a credit card.  there is a good funds law that prevents that...however...can i use a balance transfer check, deposit into my personal checking account and cut a check from my personal checking account for a percentage of the down payment? 

does the credit card company care how i spend the balance transfer money?  if i am elegible for a 8k balance transfer with 0% until next may....can i deposit those access checks in my personal account or even use those access checks for closing?? 

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I would say no, they want to verify that the funds used for down payment/closing are not on loan to you. This is why they have to source things like gift funds and recent large deposits to ensure it's not coming from a loan. 

[Creditaddict]

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@SantaMar wrote:

i have the ability to purchase a home for extremely cheap!  title companies will not allow me to close with a credit card.  there is a good funds law that prevents that...however...can i use a balance transfer check, deposit into my personal checking account and cut a check from my personal checking account for a percentage of the down payment? 

does the credit card company care how i spend the balance transfer money?  if i am elegible for a 8k balance transfer with 0% until next may....can i deposit those access checks in my personal account or even use those access checks for closing?? 

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There have been a few topics on this in the past 6 or so months and at least 1 person did it.

I think the title company is more concerned about if the funds are avialable at time of check but I'm not clear on what "good funds law" is... so I would look at what that in tales and otherwise you should be able to deposit the BT (the credit card company usually does not care) and then write the check that way... maybe need to let it sit in yoru account for 30+ days or something...

[fltn]

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@SantaMar wrote:

i have the ability to purchase a home for extremely cheap!  title companies will not allow me to close with a credit card.  there is a good funds law that prevents that...however...can i use a balance transfer check, deposit into my personal checking account and cut a check from my personal checking account for a percentage of the down payment? 

does the credit card company care how i spend the balance transfer money?  if i am elegible for a 8k balance transfer with 0% until next may....can i deposit those access checks in my personal account or even use those access checks for closing?? 

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If this was for a cash sale I would say yes, as this is what I did. But if you are financing the house no, because they will want to see where the funds are coming from.

I have done this twice to buy and then sell 2 homes, but at closing I basicly had deed in hand and they were not financed by a mortgage.

[maceto]

?? Why make this complicated. Have parents? Cut the check to your dad and have your mom give you 8K.. If they want to see where the money came from it was a gift and if they go as far as to want your mom's statements well no check from you there... Must be many ways around this.

[lionsfan20]

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@maceto wrote:
?? Why make this complicated. Have parents? Cut the check to your dad and have your mom give you 8K.. If they want to see where the money came from it was a gift and if they go as far as to want your mom's statements well no check from you there... Must be many ways around this.

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ya , good job contributing your two sense. The whole point of verifying where the money came from is to make sure he can make the payments during the finance. What does a gift prove to a bank that he can pay the mortgage? Is he going to get a gift every month?

[enharu]

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@lionsfan20 wrote:

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@maceto wrote:
?? Why make this complicated. Have parents? Cut the check to your dad and have your mom give you 8K.. If they want to see where the money came from it was a gift and if they go as far as to want your mom's statements well no check from you there... Must be many ways around this.

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ya , good job contributing your two sense. The whole point of verifying where the money came from is to make sure he can make the payments during the finance. What does a gift prove to a bank that he can pay the mortgage? Is he going to get a gift every month?

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it will depend on many things.

It's not too uncommon for parents' to contribute to their kids' downpayment for homes. Whether he can make those payments during the finance is dependent upon his income and other debt obligation(s). If he has no or low income, then he won't qualify for the mortgage even if he came up with the downpayment on his own, unless he starts shopping for a cheaper house or finds a better job.

 It will also depend on the bank he's working with. With mortgage laws being tightened, the bank may want to see all relevant documents for source of downpayment. Hence even with a BT check depositted to his parents' accounts, it may not work. If his banker is willing to cut him some slack due to his banking relationship with them, then he'll have less problems.

[SantaMar]

thanks for all the comments...for the record this is not for a financed house.  there is no lender...just me and the seller and an title company...this is for an investment property i am planning to rent....home is selling for 15k.  (its a shell and needs work) i have a 10k balance transfer available....i wanted to use this for the promo period and by the time the promo is paid off i will have the home rented to cover any payments that need to be made....

[fltn]

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@SantaMar wrote:

thanks for all the comments...for the record this is not for a financed house.  there is no lender...just me and the seller and an title company...this is for an investment property i am planning to rent....home is selling for 15k.  (its a shell and needs work) i have a 10k balance transfer available....i wanted to use this for the promo period and by the time the promo is paid off i will have the home rented to cover any payments that need to be made....

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Then deposit the BT check in your account. Is the title company going to  take a check or do they want a wire payment.

When I did this, my title company would ONLY take wire payment. My bank put a 10 day hold on a check (from NFCU to BBT) both my accounts, so I would do this quickly if you need the cash in the next 10 days or so.

My second house I just did a cash advance from my NFCU into checking, wired the money and then used a BT to pay off the cash advance for 0%. So I only had the cash advance interest for 20 days, small price to pay to avoid the bank hold on my own check. 20 days interest is from date of cash advance to 2 weeks to allow time for a BT to go through.

Also not sure who you are buying house from HUD, homepath, etc, if you are placing a bid, but if it is you will need to have proof of funds very quickly. If not before you bid, but with in 24 hrs of bid acceptance if it is say HUD. Just make sure you have your ducks in a row, it goes fast and you will need to be ready.

Good luck.