Mortgage downpayment question...

[Pistonsfan70 10+ year member]

I am looking to buy a house very soon and I have a few questions...

I know you need to show 2 months worth of bank statements so I opened a savings account....I am at around $3,500 now and my fiance wants to contribue 3 grand since it's going to be OUR house....problem is, she can't co-sign with me because she is still getting Financial Aid and she has to "live" with her parents to recieve it....Would most mortgage places think it's weird that 3 grand just POPPED into my savings account when I've only been adding $750 every other week, or would they not care since most of the $ is added at a regular basis???

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[jeepintn 10+ year member]

they are gonna look at way more than a couple months, they will know everything about your financial history before you get approved for a mortgage

 

[ace_800 5,000+ posts]

They won't care, as long as there is a money being put in to the account. They don't care who it came from.

and ^x2

 

[BigOso 10+ year member]

If this is your first house make sure you ask your lender about the first time home buyer programs. There are programs out there to help you cover closing costs and down payment.

 

[TylerBD12 10+ year member]

if you just opened the account then you should be okay. On the other hand, if you have had the account for a while and you average around say, $700 or so in your account every bank statement then just suddenly your bank statement jumps up to 3500, they'll probably want to see where that came from.

 

[ace_800 5,000+ posts]

No they should not care where the money came from, depends on the bank. When I bought mine i had 4k in it and my dad gave us 3k as a wedding gift from his side of the family, bank didn't care.

 

[TylerBD12 10+ year member]

well if it's from family then you're good, you just need a gift letter, but she's not family yet.

 

[Kai Winters 10+ year member]

3K is no big deal.

You will need your 1040's to show overall income as well as current pay stubs.

Make a list of any loans, credit cards, etc. that you may owe. Include college loans if any. List the name of the company, account number and balance.

The bank/mortgage company will do a credit check anyway but you can add this to the mortgage application.

I strongly suggest you stay away from an ARM (Adjustable Rate Mortgage) if one is offered. They are just not worth it especially with the housing market being in a state of flux right now.

Generally if you look around a bit you can get a mortgage with no points or closing costs but those are usually written into the mortgage anyway...nothing is free hehehe.

Try Churchill Mortgage. I have heard some good things about this company. They have a good reputation. Stay away from Ditech...they have a horrible rep.

The biggest thing mortgage companies look for is the mortgage to wage ratio. If the mortgage is 50% of your income you are not going to afford the house considering the costs of home ownership...insurance, taxes, maintenance, etc.

Good luck and keep us informed.

 

[flyfishfreak 10+ year member]

I am looking to buy a house very soon and I have a few questions...
I know you need to show 2 months worth of bank statements so I opened a savings account....I am at around $3,500 now and my fiance wants to contribue 3 grand since it's going to be OUR house....problem is, she can't co-sign with me because she is still getting Financial Aid and she has to "live" with her parents to recieve it....Would most mortgage places think it's weird that 3 grand just POPPED into my savings account when I've only been adding $750 every other week, or would they not care since most of the $ is added at a regular basis???

Hello,

Well...I find it kind of funny that my firt post is a response to a mortgage question. Oh well, lemme start by saying I am a Mortgage Broker and your question is a good one. Have you ever heard of seasoning? Well basically that "could" be the dilema you will face with only two (2) months seasoning on your funds/assets. To be honest the seasoning requirment may vary, depending on who your working with. The industry standard for a FNMA loan is 6 months seasoning for funds, i.e. down payment and for reserves (principal interest & Tax/insurance; usually 3-6 months depending on the lender). So, say you need 10,000.00 for your down payment and say 6,000.00 for reserves. You will have to have 16,000.00 of verifiable seasoned funds, typically in the account for a minimum of six(6) month.

So yes, the lender "may" care if you have large (or small) deposits that are "fresh" in the account and your trying to use that money against your loan. Now keep in mind they only care about funds being used for the deposit total and reserves. Something else to consider on the 3000.00 from your GF, is if your lender accepts gift funds and up to what % of your loan amount. Gifted funds usually are not required to be seasoned.

I hope this cleared it up a little, if only to help you to ask your loan officer the right questions. If you have anymore questions please feel free to PM me. Mortgages can be compicated and there is tons of free information avaiable on the Fannie Mae website. //content.invisioncic.com/y282845/emoticons/graduate.gif.d982460be9f153bb54e5d4cb744f6ae8.gif

Later

 

[flyfishfreak 10+ year member]

3K is no big deal. You will need your 1040's to show overall income as well as current pay stubs.

Make a list of any loans, credit cards, etc. that you may owe. Include college loans if any. List the name of the company, account number and balance.

The bank/mortgage company will do a credit check anyway but you can add this to the mortgage application.

I strongly suggest you stay away from an ARM (Adjustable Rate Mortgage) if one is offered. They are just not worth it especially with the housing market being in a state of flux right now.

Generally if you look around a bit you can get a mortgage with no points or closing costs but those are usually written into the mortgage anyway...nothing is free hehehe.

Try Churchill Mortgage. I have heard some good things about this company. They have a good reputation. Stay away from Ditech...they have a horrible rep.

The biggest thing mortgage companies look for is the mortgage to wage ratio. If the mortgage is 50% of your income you are not going to afford the house considering the costs of home ownership...insurance, taxes, maintenance, etc.

Good luck and keep us informed.

The 1040's are not required for a full-doc file. Tax returns should only be used by business owners who are not w-2'ed. Most of us attempt to write off as much as possible on our taxes and you would hate to have your actual income chopped in half becuase of concervative underwriting. You should only have to provide 2 years work history (within the same job field and no gaps), your most recent w-2 and your last two(2) paystubs. The lender will then add your gross income from the w-2 with your Gross YTD on your most recent paystub, then divide that number by the total number months (i.e if your last paystub was the last two weeks in April, then it would use 12 months for the w-2 tax year and 4 months for the current, for a total of 16 months).

Also, the Debt to Income Ratio, i.e. DTI is very important. Actually if you are doing a fully verified loan application with A paper status (A paper being great credit, i.e. 680+ FICO) the DTI is usually 45%, not 50%. The lender will determine the DTI by dividing your total monthly debts (total housing expense and credit liabilities) by your caculated gross income. Some lenders have alternative loan programs that allow for a higher DTI, it just depends on that lender and the program.

 

[Kai Winters 10+ year member]

Great info fly...

I could not think of the term DTI hehehe.

I also could not remember if mortgage companies wanted a W2 or the 1040's. I am not in the biz and it was years ago when I got my last mortgage. I paid cash for my last house due to a great housing market 3 years ago and an awesome house sale.

 

[docutech 10+ year member]

Hello,
Well...I find it kind of funny that my firt post is a response to a mortgage question. Oh well, lemme start by saying I am a Mortgage Broker and your question is a good one. Have you ever heard of seasoning? Well basically that "could" be the dilema you will face with only two (2) months seasoning on your funds/assets. To be honest the seasoning requirment may vary, depending on who your working with. The industry standard for a FNMA loan is 6 months seasoning for funds, i.e. down payment and for reserves (principal interest & Tax/insurance; usually 3-6 months depending on the lender). So, say you need 10,000.00 for your down payment and say 6,000.00 for reserves. You will have to have 16,000.00 of verifiable seasoned funds, typically in the account for a minimum of six(6) month.

So yes, the lender "may" care if you have large (or small) deposits that are "fresh" in the account and your trying to use that money against your loan. Now keep in mind they only care about funds being used for the deposit total and reserves. Something else to consider on the 3000.00 from your GF, is if your lender accepts gift funds and up to what % of your loan amount. Gifted funds usually are not required to be seasoned.

I hope this cleared it up a little, if only to help you to ask your loan officer the right questions. If you have anymore questions please feel free to PM me. Mortgages can be compicated and there is tons of free information avaiable on the Fannie Mae website. //content.invisioncic.com/y282845/emoticons/graduate.gif.d982460be9f153bb54e5d4cb744f6ae8.gif

Later

Absolutely!

The underwriters will "care" as money suddenly poping up in an account which is fairly new will raise a LOT of flags. If you are going to get a mortgage through a bank, those suspicions will be doubled. A broker or a firm will be less leanient as "seasoning" (mentioned above) will be the loophole. I second the idea of a "gift" from your girlfriend. It will look much better on paper.

Great advice flyfishfreak!

 

[bigbangtheory 5,000+ posts]

There is some good info in this thread. Thanks guys!

 

[flyfishfreak 10+ year member]

Glad I could help. If anyone has any questions please feel free to to PM me.