topic Re: What happens if you can't source a deposit in Mortgage Loans

What happens if you can't source a deposit

Anonymous — Tue, 23 Jun 2020 22:43:12 GMT

So, we are in underwriting and I can't "prove" our economic stimulus deposit. First, I threw away the confirmation that was sent from the IRS. It clearly says from the "IRS" on our statement so I am unsure why a simple letter of explanation wouldn't work but my LO is going to try to come up with something.

Could this prevent us from getting the mortgage? Thoughts?

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 04:47:50 GMT

If your Bank Stmt clearly shows an electronic deposit and it's labeled by the bank IRS and this was not a physical check then the only thing you can do IS to write a 2 sentence letter dated and signed along with a copy of your stmt. if your lender does not accept what is so obvious a deposit by IRS and NOT Your aunt Mary then you need a new lender.

in your 2 sentence letter the last sentence should be You Have No Other Proof to offer as this was an Electronic Depisit which you're bank clearly shows as coming from IRS. They don't just give out loans !

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 05:01:41 GMT

Have you tried using the IRS website to see if it will say they already sent your Stimulus Check???
I tried to post a link but this website won't allow me to be that super helpful 👿

Google "IRS where is my stimulus check" it will lead you to an IRS web site that is for helping people get the status of their check. See if it will work in reverse and say they already sent X $$$ .... Good Luck

Re: What happens if you can't source a deposit

Anonymous — Wed, 24 Jun 2020 13:11:41 GMT

*delete*

Re: What happens if you can't source a deposit

homeloanexpert — Wed, 24 Jun 2020 13:35:33 GMT

@Anonymous

This shouldn't even be an issue! Your bank statement should clearly that the IRS or Dept. of Treasury was the source of the deposit. But if you're going FHA, as long as you are within the 1% of the purchase price rule, that deposit doesn't require documenting.

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 13:41:05 GMT

When it comes to small minded Underwriters, sometimes you just can't fix Stupid!

Re: What happens if you can't source a deposit

Anonymous — Wed, 24 Jun 2020 13:55:40 GMT

Yes, the IRE does not give out loans. That's the same thing I told my husband. It clearly states from the IRS.

I went online and used the where's my app but it only shows the deposit date and last four of our account number. Our LO said that won't work. I called the IRS and they said they aren't mailing anything.

We are going fha and it's more than 1% but it isn't the source of our down payment. We had the money before then. I don't understand why we can't just write a LOE. Our closing date is in 2.5 weeks so I need to know if this is a deal breaker. Waiting on the LO to get back to me.

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 14:08:42 GMT

Write the LOE anyway and make a copy of the IRS info as the date and the acct number match up. Provide all the info along with the LOE and tell the LO to provide it to the UW. In your LOE make it clear IRS will provide no additional info and this is all you can provide. Don't wait for the LO to come up with more things you can not provide. This is something that has become ridiculous and you have enough info to prove your point.

Otherwise you need to immediately transfer your FHA case # and appraisal to another lender.

Just send the letter in and be clear this is it.

Re: What happens if you can't source a deposit

homeloanexpert — Wed, 24 Jun 2020 15:33:10 GMT

@Anonymous

FHA only requires the borrower to source or document deposited funds that will be used to purchase your home. If those funds will not be used, the underwriter can simply back them out of your assets. You will not be required to document that deposit, only write an LOE. Seems like you have a rookie underwriter.

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 15:35:41 GMT

Ditto OR it's not the UW at all but a Rookie Processor/clueless LO!

Re: What happens if you can't source a deposit

Anonymous — Wed, 24 Jun 2020 16:59:41 GMT

I don't quite understand why you would have to divulge any of that info. So if I have $5K in my reserve savings account "B" that I plan to use towards a purchase of a home, they want to know where it came from? How am I supposed to know that when it's been adding up over time from various sources?

As for the Stimulus it should be as easy as looking at your statement and printing it. Mine says IRS deposit right on it.

Re: What happens if you can't source a deposit

dragontears — Wed, 24 Jun 2020 19:24:05 GMT

@Anonymous wrote:
I don't quite understand why you would have to divulge any of that info. So if I have $5K in my reserve savings account "B" that I plan to use towards a purchase of a home, they want to know where it came from? How am I supposed to know that when it's been adding up over time from various sources?

As for the Stimulus it should be as easy as looking at your statement and printing it. Mine says IRS deposit right on it.

@Anonymous money that has been in a bank account for >2 statements is "seasoned" and doesn't need to be sourced. It is "large" deposits that are on the statements that need to be sourced to insure that you are not borrowing the money for dp and closing costs.

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 19:38:38 GMT

It's the nature of "small minded" UW to question any large deposit that appears on a bank stmt in the file no matter how old the stmt.. The reasoning is you have possibly borrowed money and not disclosed a debt. However in this case the Bank Stmt clearly shows this is a Deposit from IRS and the IRS clearly shows a Date if Deposit and last 4 digits of the bank acct in question. A three sentence LOE would clear this up in 30 seconds. This requests sounds like something from an inexperienced UW, P, or LO.

But if from actually the UW it's never a good idea to get in a pissing match with them.

Re: What happens if you can't source a deposit

dragontears — Wed, 24 Jun 2020 20:50:31 GMT

@JVille wrote:
It's the nature of "small minded" UW to question any large deposit that appears on a bank stmt in the file no matter how old the stmt.. The reasoning is you have possibly borrowed money and not disclosed a debt. However in this case the Bank Stmt clearly shows this is a Deposit from IRS and the IRS clearly shows a Date if Deposit and last 4 digits of the bank acct in question. A three sentence LOE would clear this up in 30 seconds. This requests sounds like something from an inexperienced UW, P, or LO.
But if from actually the UW it's never a good idea to get in a pissing match with them.

Completely 100% agree with you, I closed on a house last Friday (with a 25 day time frame from PA to close) and my lender didn't even blink about the deposit from the IRS. I wasn't even required to do a LOE for anything other than the normal inquiries LOE.

Re: What happens if you can't source a deposit

JVille — Wed, 24 Jun 2020 20:58:03 GMT

@dragontearsExactly as I t should be. It's called common sense!

Re: What happens if you can't source a deposit

randomguy1 — Thu, 25 Jun 2020 00:20:28 GMT

@JVille wrote:
It's the nature of "small minded" UW to question any large deposit that appears on a bank stmt in the file no matter how old the stmt.. The reasoning is you have possibly borrowed money and not disclosed a debt. However in this case the Bank Stmt clearly shows this is a Deposit from IRS and the IRS clearly shows a Date if Deposit and last 4 digits of the bank acct in question. A three sentence LOE would clear this up in 30 seconds. This requests sounds like something from an inexperienced UW, P, or LO.
But if from actually the UW it's never a good idea to get in a pissing match with them.

All good points. They can be annoying as hell but it's never a good idea to getting into a pissing match with them. It's a lose-lose situation. I have had an underwriter question a large deposit from MY EMPLOYER that was a bonus check that just came in. The deposit clearly showed my employer name and those funds were not part of the DP. It was a day before closing and just mind boggling why there are so many last minute requests they should have addressed earlier or have common sense.