FHA Loan - Large Deposit?
I have a deposit of 6k in my account. It is from a friend who re-payed a debt. What will I need as a source of funds for the underwriter? Is there a possibility my loan can be denied due to this?
Will the canceled check be acceptable as a source of the funds? What types of deposits are unacceptable?
I have sufficient funds to cover the down payment without that 6k deposit. I submitted 4 accounts to the lender (3 savings and my checking) and all of those accounts can more than fund the down payment. I was assuming that I would need to provide some type of letter of explanation for this. I also have evidence in one of the accounts of frequent transfer made to the person repaying me.
- JimLv 49 years agoFavorite Answer
There is a chance your loan could be denied. But, the first question is, are you depending on all or part of that $6000 as part of your down payment and closing costs? If not then you should be ok.
But, I assume that the answer is yes. I also assume that the $6000 isn't a repayment of debt that you just happened to get right before you're buying a house. You can't trick an underwriter. They've seen all the tricks in the book.
The rules is that you can receive a gift from a family member, not friends. So, what you need to do is get the money ahead of time and let it season in your checking/savings account. How long has the money been in your account? You might consider waiting until your next statement cycle before providing your statement.
If it is really a debt that is being repaid (which again I doubt) then what you need to do is try to provide evidence of this. An old email? A written agreement that you had? A letter of explanation signed by you and the person that "paid you back" And what was the purpose of the original $6000 loan.
- spalmerLv 79 years ago
There's always the possibility that the loan will be denied -- it probably would have been better to deposit that 6k in a separate account (they typically care most about the account that has your down payment). Or, to simply hold the check until you finished with closing. Regardless, they'll likely just ask for a copy of the cancelled check (get this from the bank) and may require a statement from your friend that this was for repayment of a loan that you provided from "x date" to "x date."