Seasoned funds

[capez]

My husband and I just found the home of our dreams and have successfully negotiated a price that is of value. The builder is asking for 10k earnest money that is returnable for only 14 days for approval. I have some concerns with this as that is a big chunk of change to put at risk. I wanted to come to you all first before sending that wire and signing the contract

Currently my husband is pre approved for 380k with 5% down

House listed for 405,000 we have a contract accepted at 370k

Income: 125k salary 45k bonus
He was promoted midway through 2015 and grossed 136k in 2015. 2014 his w2 income was 60k and had a 30k bonus

648 mid score.

Low score is from student loan Kate's from 5+ years ago that went severely past due after coming out of deferment. (Have tried a million times to fix)

We have 35k in savings but just got that deposited from my husbands 2015 bonus deposited beginning of this month. Total cash to close from lender was quoted as 24k.

Here is my big concern that I didn't even think about. We just had the funds deposited into the account and they are not seasoned. We can prove exactly where it came from as it was a pay roll dwposit into our saving account.

Out DTI will be low but given the circumstances I am very concerned. Any advice out there?

I will not be on the loan as I stay at home

[Imperfectfuture]

What do the attorneys say?

[capez]

I haven't spoken to one yet. Still haven't gotten the contract

[capez]

I was more wondering from a qualification perspective.

[iv]

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@capez wrote:
We have 35k in savings but just got that deposited from my husbands 2015 bonus deposited beginning of this month. Total cash to close from lender was quoted as 24k.

Here is my big concern that I didn't even think about. We just had the funds deposited into the account and they are not seasoned. We can prove exactly where it came from as it was a pay roll dwposit into our saving account.

Out DTI will be low but given the circumstances I am very concerned. Any advice out there?

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Seasoned or sourced.

If it was a payroll direct deposit from his employer.... no problems.

If it was a random, un-sourced deposit, or the bonus was paid in cash that you then deposited, that would be trickier.

[capez]

So even though it was just deposited that's okay?? I keep reading about funds being seasoned for over 60 days on bank statements?

[leahkline86]

No issue for the funds if it was a payroll source. They will just want to see that paystub. That's all. I have 10k in a bonus that I am using for my closing and I'm not getting it until about 5 days before. It is a non issue. Only issue is if it's not verifiable or if it is a loan. I'm interested to hear if they will use his 2015 income or if they will want to average the last two years for what you qualify for. Be careful with the credit score though, a few point drop could lose any conventional loan options. (If that is what you're going for)

[capez]

What is the minimum score? The lender already pulled my credit the other day for the pre approval

[iv]

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@capez wrote:
So even though it was just deposited that's okay?? I keep reading about funds being seasoned for over 60 days on bank statements?

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Yup, it's just fine.  Payroll deposits are sourced.

Money your crazy great-grand-uncle gave you in cash six months ago (and you deposited) is seasoned.

Money your parents gifted to you yesterday (and you deposited) is sourced if you supply a gift letter.

Money you found in a dufflebag on the street corner this morning (and you deposited) is neither sourced nor seasoned. (Nor safe! Put it back! )

It's only money that is neither sourced (clearly traced to an acceptable source of funds) or seasoned (has been present in the account for 60+ days) that is an issue.

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@capez wrote:
What is the minimum score? The lender already pulled my credit the other day for the pre approval

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There is a threshold at 640 - just be aware that if that 648 score drops below 640, you may end up in a different rate tier and/or have more limited loan options.

[Anonymous]

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@capez wrote:
My husband and I just found the home of our dreams and have successfully negotiated a price that is of value. The builder is asking for 10k earnest money that is returnable for only 14 days for approval. I have some concerns with this as that is a big chunk of change to put at risk. I wanted to come to you all first before sending that wire and signing the contract

Currently my husband is pre approved for 380k with 5% down

House listed for 405,000 we have a contract accepted at 370k

Income: 125k salary 45k bonus
He was promoted midway through 2015 and grossed 136k in 2015. 2014 his w2 income was 60k and had a 30k bonus

648 mid score.

Low score is from student loan Kate's from 5+ years ago that went severely past due after coming out of deferment. (Have tried a million times to fix)

We have 35k in savings but just got that deposited from my husbands 2015 bonus deposited beginning of this month. Total cash to close from lender was quoted as 24k.

Here is my big concern that I didn't even think about. We just had the funds deposited into the account and they are not seasoned. We can prove exactly where it came from as it was a pay roll dwposit into our saving account.

Out DTI will be low but given the circumstances I am very concerned. Any advice out there?

I will not be on the loan as I stay at home

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10K in earnest money? I'm not an expert, but that does seem like a lot. For a point of reference, our earnest money check was for $5,000 and the house that we bought was $525,000 with 11% down. Can you ask the builder how or why they came up with the 10K figure?