Home Buying in 90049>Question Details

pattymatt2003, Home Buyer in Los Angeles, CA

doubts on mortgage application

Asked by pattymatt2003, Los Angeles, CA Fri Jan 4, 2013

I have some questions on the mortgage application. Could anybody please resolve my doubts?

1. Does opening new bank accounts or closing bank accounts affect the credit score?

2. Hearsay that you have to show your lender "at least two months statements" of your bank deposit as your down payment when applying a mortgage. Is it true?
I mean, if one person gets $100,000 support from parents as down payment on January 1, 2013, and try to apply mortgage on January 15, 2013. Will he be rejected on giving a loan? or need to pay higher interest rate?

3. For some reasons, one person transfers his money from Bank A to Bank B (both bank accounts are under his name). Will this transfer affect his mortgage application?

Thank you very much.

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Answers

8
Do not worry about opening or closing new bank's account. But, they do need to see the last two bank statements from both banks, Is crucial that you shop around for a mortgage broker that can explore all your financial options. They have access to many banks, private lenders and different programs.

Best of Luck,

Maria Cipollone
Century 21 Tenace
http://www.Flahomespecialist.com
2 votes Thank Flag Link Fri Jan 4, 2013
Dear Patty,

I would ask the mortgage lender these question rules change all the time. To my knowledge:

1. Opening one bank account and closing another does not affect credit score but lenders want to see a trail. In other works. Closing one account with $50,000.00 and opening another bank account transferring $50,000.00 but adding additional $50,000.00 = $100,000.00 lenders will question where addition $50,000.00 can from.
2. Money in bank account has to be seasoned. It maybe 2 months or longer. Verify length of time with direct lender. If there is a gift from parents of $100,000 which is total down payment verify with lender if is acceptable may appear like parents are purchasing property.
3. Again there has to be a money trail if transfer $50,000 from bank A to bank B funds from bank A have to be seasoned.
In all scenario verify with direct lender for valid professional mortgage lending answers.

Gail Mercedes Cole
EXP Realty
310.853.9933
0 votes Thank Flag Link Wed Jul 17, 2013
New bank accounts fine. Just make sure we can follow the paper trail for the source of deposits. You may need gift letters and or copies of deposited checks.
Two months statementsnnthemfunds must be "seasoned " for 90 days. Meaning must be yours for 90 days.
That $100k will require a gift letter that will be provided for you map rents must show a copy of the cleared check or evidence of wire transfer. Parents must provide statement showing those funds were from their account with a bank statement.
Paper trail the transfers and you will be fine.
0 votes Thank Flag Link Sun Jan 6, 2013
SEE ANSWERS IN CAPS
1. Does opening new bank accounts or closing bank accounts affect the credit score?YES SLIGHTLY BUT NOT ANYTHING OF SIGNIFICANCE UNLESS BANK HAS CLOSED YOUR ACCOUNTS FOR SOME REASON.

2. Hearsay that you have to show your lender "at least two months statements" of your bank deposit as your down payment when applying a mortgage. Is it true?YES AND SOMETIMES 3 MONTHS

I mean, if one person gets $100,000 support from parents as down payment on January 1, 2013, and try to apply mortgage on January 15, 2013. Will he be rejected on giving a loan? or need to pay higher interest rate?IT WILL DEPEND MORE ON YOUR INCOME THAN YOUR DOWN PAYMENT

3. For some reasons, one person transfers his money from Bank A to Bank B (both bank accounts are under his name). Will this transfer affect his mortgage application? NO, IT SHOULD NOT
0 votes Thank Flag Link Fri Jan 4, 2013
Hi Doubts-

1. No bank accounts do not apply to your credit rating

2. You would need to show the 2 months bank stmts plus a gift from the parents. Rate is not affected.

3. We would need to see both bank accounts.

Hope this helps...

Gabriella Godde
661-713-3460
0 votes Thank Flag Link Fri Jan 4, 2013
Please see my answers below:

1. No - opening/closing bank account does not affect your credit score.

2. Yes most lenders require you to show 2 month bank statements.
In case you receive your money as gift - it need to be document (gift letter) and you will need to comply with bank guidelines regarding gift funds.

3. Transferring money from one account to another is ok for as long as you can show documents regarding these transfers.

Hope this will help you!



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0 votes Thank Flag Link Fri Jan 4, 2013
Hi Patty Matt, to answer your questions...

1. No, opening or closing bank accounts do not impact your credit score (that is, unless the bank checks your credit to open a new account, then you would have a credit inquiry and credit inquiries can usually knock your score down a few points each). Open or closing credit cards, or paying off or taking out a new loan can impact your credit score though.

2. Providing the most recent 2 months of bank statements is pretty standard, unless you don't need any money to close or to qualify with. For example I am doing a refinance for someone into an FHA mortgage, and we are putting the new loan amount to where it includes their existing mortgage + the closing costs, and also FHA doesn't require any "reserves" (money in the bank after closing) so they aren't having to provide any bank statements.

In the situation you are describing, the $100k from the parents would be considered "gift funds", and gift funds need to be documented by a gift letter (from the donor to the person receiving the gift), and evidence the donor had/has the funds to gift (so if they've already been transferred, a copy of the check that was used to transfer the money could be used). There is no higher interest rate that is paid because gift funds are being given, however there are some additional guidelines that need to be followed when gift funds are being used.

3. No, transferring money from one account to another account happens all of the time, i.e. paychecks are deposited into one account and then funds are transferred from that account into a new account to pay bills, etc. The transfers need to be documented though, which could be done by supplying both bank statements to show the withdraws/deposits match up... and if they aren't direct transfers but instead was a check written from the account, then a copy of the check as well.

Hope this info helps, feel free to ask more questions, and if you need help with the mortgage when it comes time to applying, I'd be happy to help with that too.

Shane Milne | Lending in all 50 states | NMLS #81195
0 votes Thank Flag Link Fri Jan 4, 2013
Hello,

You know, each situation is different and each different loan program has different underwriting standards. Regardless of heresay and advise on the column, I strongly encourage you to go through the application process yourself.

By finding a local mortgage person to work with, and complete the application process, your financial picture will be reviewed in its entirety instead of you trying to make sense of every little detail. Even if you don't qualify, you will emerge from the process knowing exactly what you need to do in order to improve your credit.

Good luck.
0 votes Thank Flag Link Fri Jan 4, 2013
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