Whatever funds the borrower intends to use to close a transaction has to be sourced and seasoned. Providing proper asset documentation and the actual source of the funds is a critical element of the approval and closing process. There’s nothing worse in a real estate purchase than making it all the way through the hoops and hurdles of the approval process just to have a loan fall apart due to the borrower not using an acceptable source of funds in order to close. In other words, “Mattress Money” is no longer a legitimate source.
Seasoning of “assets to close” is just as important as the source, which is why underwriters typically require at least two months bank / asset statements in the initial mortgage approval process.
Acceptable Sources Of Down Payment/Closing Costs Include:
- Bank Accounts – checking / savings
- Investment Accounts – money market, mutual funds, stocks
- Retirement Funds – Borrowing against vs. Liquidating
- Life Insurance – Cash value and face amount
- Gifts – Family members can gift down payment funds with certain restrictions
- Inheritance / Trust Funds
- Government Grants – Many state, county and city agencies offer special down payment assistance programs
It is extremely important to make sure your loan officer is aware of the exact source of funds you anticipate using for your down payment and closing costs as early in the process as possible so that all necessary questions, documentation and explanations can be reviewed / approved by an underwriter.
St. Louis MORTGAGE INTEREST RATES for May 2, 2012:
- Conventional 30-Year Fixed 4.00%/ 4.195% APR
- Conventional 15-Year Fixed 3.250%/ 3.390% APR
- Conventional 5/1 ARM 2.375%/ 3.082% APR
- FHA/VA 30 Year Fixed 3.750%/ 3.991% APR
- Jumbo 5/1 ARM 2.875%/ 3.445% APR
- Jumbo 15 yr Fixed 3.375%/ 3.630% APR
- Jumbo 30 yr Fixed 4.750%/ 5.010% APR
*The above mortgage rates are based upon an 80% LTV, o/o single family with FICO scores of 720.
Paramount Mortgage is a locally owned Mortgage Banker celebrating our 41st year. Great rates and programs are secondary to what is most desired in a lender relationship: Integrity, Communication and Customer Satisfaction. Be to check out our website: www.paramountmortgage.com
For more information or if you have questions on mortgage rates you may contact me by phone at my direct line, (314) 372-4319, email at rfishel@paramountmortgage.com or you can visit our company website at http://www.paramountmortgage.com.
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