Account Activities Matter When Applying for your Chicagoland Mortgage

 

Account Activities Matter When 

Applying for your Chicagoland Mortgage

 

 

     Almost all Mortgage Lenders require that Loan Applicants submit each and every page of their Bank Statement, Investment Account, and Retirement Fund (showing source of Down Payment), not just a first page.  


     And note:  That's even if a page in the statement's sequence is only numbered and blank (something that trips-up many Applicants).  

     Why?  

     There are several reasons ... but the following are the issues that most commonly trigger Lenders' requests for full statement/documentation:  

  • "Large" deposits from Income/Payroll Transfers, as well as deposits made frequently from other accounts, cash, etc.  (Tip: Avoid making cash deposits into accounts at all costs!)
  • Having to identify sources of deposits. (Deposits direct from Payroll, Social Security, transfers from other accounts, "non-descript" deposits, check deposits, or wire transfers)  
  • Automatic monthly payments for recurring debt
  • Proof of Earnest Money Checks clearing the account.  (This is almost always verified on PURCHASE transactions)
  • Proof of Gift Money received (If applicable)
  • Proof of Consistency/Timeliness of payments for Rent or Housing 
  • Type of expenditures (ability to manage funds or budgets)                                                                                                                 It's not-uncommon for me to be questioned by my Chicagoland Borrowers regarding these requests, as Borrowers want to know ...  

 

     "Why do Underwriters need to know WHERE my Down Payment and Closing Funds come from?  Isn't the fact that I have the money enough?"

     But look at all the scenarios and concerns Mortgage Underwriters must consider regarding these funds and their place of origin:

  • A Borrower takes out a Personal Loan, Signature Loan, or a Credit Card Advance to fund their Down Payment or to be able to Close their loan.  (More debt is incurred in these instances and that can affect a Borrower's ability to repay their Mortgage)
  • A "gift" of funds is received from a relative, etc., but is in reality a loan where funds will need to be repaid.
  • The funds come from a new or "unreported" loan secured by other Real Estate Owned by the Borrower (such as a Home Equity Line of Credit)
  • A Borrower will be increasing their Housing Payment by a significant amount ... or will be depleting all of their liquid assets for Down Payment and Closing Costs.
  • The funds for Down Payment entered a Borrower's Account in the last 60 days.  (A huge red flag for Underwriters, as they need to know WHERE those funds came from.)


     Potential Chicagoland Borrowers and current Mortgage Applicants must be aware:  Statements from their Bank, Investment Account, and Retirement Fund will be requested of them, then reviewed very carefully (in their entirety)  by Mortgage Underwriters.

     Because of this fact, it's wise for Borrowers to:  Make it a habit to fully-document, save, and organize financial records as they head towards the time for Mortgage Pre-Qualification and then subsequent Mortgage Application.  It's also wise to limit the number of transfers of funds they make between accounts.

     By practicing the above suggestions, Borrowers insure that they can fulfill any requests received by Underwriters quickly and easily ...  


 

 

    *  Hoping to Buy or Refinance a home in New LenoxWill County, the greater Chicagoland area, or Wisconsin?  Contact Me today!  I'll be happy to put my 37 years of mortgage experience and expertise hard to work on your behalf.
     I can be easily found at:

Gene Mundt

Mortgage Lender  -  NMLS #216987  -  IL Lic. #0006220  -  WI Licensed

American Portfolio Mortgage Corp.

NMLS #175656

 

Direct:  815.524.2280

Cell/Text:  708.921.6331

eFax:  1.815.524.2281

gmundt@goapmc.com

www.genemundt.com

 

 

  

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Gene Mundt

 Mortgage Originator  -  NMLS #216987    

                                 IL Lic. #031.0006220  -  WI License #216987                                                                                                    

NMLS #175656

 

Gene Mundt, Mortgage Originator,  40+ years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL and Wisconsin. 

 

Your Referrals & Testimonials are Always Greatly Appreciated! 

 

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Comments

Hi Gene - We have had buyers tripped up over this easily avoidable issue in the past, but your explanation provides clear reasons that we can pass along as a heads-up. Thanks!

Posted by Dick Greenberg, Northern Colorado Residential Real Estate (New Paradigm Partners LLC) almost 3 years ago

Hello Gene - you've answered a lot of questions that buyers surely have. It took me by surprise on a re-fi when I had to send even blank pages of statements.

Posted by Lottie Kendall, Serving San Francisco and the Silicon Valley (Compass) almost 3 years ago

Gene, this is a very important issue these days.  AND every page of the statement is needed even a blank page if it is numbered.  If the statement says 1 of 8 then 8 pages are needed.  But it is amazing how something this easy creates as many headaches and delays as it does.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) almost 3 years ago

Excellent info, Gene. It's seems that many buyers have no idea how credit works. I run into these types of issues all the time. I encourage my clients to freeze in place.

Posted by Mike Cooper, Your Winchester, VA Real Estate Sales Pro (Cornerstone Business Group Inc) almost 3 years ago

Gene

Well if buyers didn't understand these issues before they certainly should now. It's a common complaint - why do they need all this documentation? Why is blank page important? Why do I have to provide proof of where money has been transferred from and to? It's a tough experience for many, but with someone like you at the helm I doubt there are too many issues. Having an explanation for the WHY is important

Jeff

Posted by Jeff Dowler, CRS, The Southern California Relocation Dude (Solutions Real Estate ) almost 3 years ago

Good morning Gene. As much coaching as we give, so just don't get it and create issue that end up slowing the process down.

Posted by Joe Petrowsky, Your Mortgage Consultant for Life (Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709) almost 3 years ago

Potential buyers should be getting all their documentation ready before they're even in the market. Good information - thanks for sharing!

Posted by Kat Palmiotti, The House Kat (Grand Lux Realty, Monroe NY, 914-419-0270, kat@thehousekat.com) almost 3 years ago

Good morning Gene. Such practical advice that many don't think applies to them until it is too late1 Enjoy your day!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) almost 3 years ago

Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com "Because of this fact, it's wise for Borrowers to:  Make it a habit to fully-document, save, and organize financial records as they head towards the time for Mortgage Pre-Qualification and then subsequent Mortgage Application.  It's also wise to limit the number of transfers of funds they make between accounts."  Right on target - Re-Blog!!

Posted by Tony and Suzanne Marriott, Associate Brokers, Serving Scottsdale, Phoenix and Maricopa County AZ (BVO Luxury Group @ Keller Williams Arizona Realty) almost 3 years ago

We've recently refi'd and you should see the data we sent in. Aside from the real estate company we also own a car and motorcycle racing company with my son. You should see all the money movement going on it's insane. The tax returns are pretty wild too. But we did it! Great post Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com 

Posted by Corinne Guest, New Homes Specialist (Barrington Realty Company) almost 3 years ago

Being a 1099 "contractor" as quite a few of us are on here, the "large" deposit scenario, is just mind boggling (to me at least). When I refinanced, 3.5 years ago, I was getting calls for every single $1,000 deposit made in my account. I thought that was quite a low threshold, but that's just my humble opinion.

Posted by J.R. Schloemer, CRS (Kentucky Select Properties) almost 3 years ago

BTW - I was not with Chicagoland Mortgage, so my rant was not directed towards CL's practices. For Full Disclosure.

Posted by J.R. Schloemer, CRS (Kentucky Select Properties) almost 3 years ago

This is the type of posting you would expect from a GO TO source. Well done Gene. Anyone who has to go through the lending process can relax with this man and enjoy the transaction to its fruition. Big yes to.... Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com ladies & gentleman

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) almost 3 years ago

Great post, Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com . It's always good to know what to expect and WHY.  Thanks for the post!  

Posted by Carol Williams, "Customized Mentoring & Marketing Services" (U.S.: I specialize in helping agents who have been in the business 2 years or less create a thriving business.) almost 3 years ago

Gene, I think that people in general do not like paperwork. I have seen many job applications with little information. People think if they have their name and address that should be enough. 

Many people do not understand the mortgage process and don't think all the detailed information  is really necessary, just some Lender being nosy.

Your post should be shared with All Buyers. It spells out what must be provided if they want a mortgage.

Thanks for a great post.

Posted by John Wiley, Lee County, FL Real Estate GRI, SRES,GREEN,PSA (Right Move Real Estate Group- EXP Realty) almost 3 years ago

Hello Gene, Excellent post of things that consumers are not aware of. I always ask for 2 years of tax returns and 2 months of assets at the time when they return my application package. Getting everything up front saves a lot of time.

Posted by Bob Betel, President, Allstar Home Mortgage, Inc (Allstar Home Mortgage, Inc.) almost 3 years ago

Another awesome bit of information that I've shared on pinterest and will be emailing to a current client.

Posted by Tammy Lankford,, Broker GA Lake Sinclair/Eatonton/Milledgeville (Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668) almost 3 years ago

Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com I remember your 10 Commandments.

Buyers must realize that what they want to do is 'huge' financial commitment and lenders want to make sure they don't 'play' with their finances while doing so.

Posted by Praful Thakkar, Andover, MA: Andover Luxury Homes For Sale (LAER Realty Partners) almost 3 years ago

Those underwriters dig deep and want full disclosure before they sign off on the loan approval. Borrowers need to be prepared to bring everything to the table!

Posted by Nicole Doty - Gilbert Real Estate Expert, Broker/Owner of Zion Realty ZionRealtyAZ.com (Zion Realty) almost 3 years ago

Thank you for the post. I will bookmark this and share with home buyers.

Posted by Gita Bantwal, REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel (RE/MAX Centre Realtors) almost 3 years ago

Great explanation on why documentation is so important.

Posted by Lyn Sims, Schaumburg IL Real Estate (RE/MAX Suburban) almost 3 years ago

Great post, Gene. This is information that can't be repeated enough. So many buyers don't get it until they've heard it a few times.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage | Charlotte, NC) almost 3 years ago

Hello Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com 

Great mortgage information that consumers need to know!

Posted by Lisa Von Domek, ....Experience Isn't Expensive.... It's Priceless! (Lisa Von Domek Team) almost 3 years ago

Gene - What great information that anyone looking to secure financing for a home loan should read. So many people do not understand how the underwriters think.

Posted by Troy Erickson, Your Chandler, Ahwatukee, and East Valley Realtor (Diverse Solutions Realty www.ChandlerRealEstate.weebly.com) almost 3 years ago

Exceelent points Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com  though I haev never understood the wisdom of the "Blank on purpose" sheets....do all lenders own stock in paper mills ?

Posted by Sally K. & David L. Hanson, WI Realtors - Luxury - Divorce (EXP Realty 414-525-0563) almost 3 years ago

I could see why certain types of people like certain aspects of Chicago for the artistry of it all. There are other aspects of it, but that is probably the main attraction

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) almost 3 years ago

These points are always excellent and I shall expect them to be in the future as well

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) almost 3 years ago

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