Source of Large Deposits (what to provide)

Lenders want you to explain source of large deposits that appears on your bank statements with a letter of explanation. You already wrote the darn letter, why do they want more documents??? Well, they want to document what you said is true. I am writing some common scenarios that might apply to you. If not, write me a comment and I will respond as soon as possible.

Large deposit is coming from:

  • Bonus pay: be prepared to provide a copy of check stub
  • Sales of personal items: bill of sales will do
  • Fund withdrawal from your 401K or investment account: a copy of statement showing the withdrawal to match with the amount in question
  • Refund from student loans: a copy of check and/or the letter provided from the payer
  • Gift from parents: Read article Gift Fund
  • Fund transfer from another bank account you own: be prepared to provide bank statement from this “other” account
  • Refund for earnest money deposit: a letter provided from escrow/title to support that it is a refund from a purchase transaction that did not close
  • Cash advance from credit card: a copy of statement showing balance withdrawal and new monthly payment on this account

If none of these situations apply to you, feel free to drop me a comment.

4 thoughts on “Source of Large Deposits (what to provide)

  1. Barbara Berget on

    My father died and had a substantial amount in his savings account. the executor of the will (my sister) closed his savings account and opened a new account with only her name and then sent me 10,000 in a cashiers check as a partial inheritance. now I am trying to get a mortgage and we are running into a wall about this money. What proof do we need to show it was not a gift or loan?

    • Underwriter on

      Provide underwriters with a copy of the Will indicating who the executor is, a copy of the check that was given to you along with a letter of explanation explaining what you just told me, you should be good to go

  2. Sarah on

    My husband found a dream home and we were not going to look for another year. Well he wants to start the process but i’m nervous because i’ve received four payday loans since Jan to help my sister out. All have been paid in full but will this hurt my chances getting my loan approved?

    • Underwriter on

      No Sarah…since you no longer owe them and they are paid off in full