Down Payment Source Validation
Lenders will typically require documentation to validate the source of the down payment, which may include bank statements, gift letters, and investment account statements.
The lender will want to ensure that the down payment is coming from a legitimate source and that there are no undisclosed loans or other financial obligations that could impact the borrower’s ability to repay the mortgage.
Anti-Money Laundering Regulations
There is no specific government department that ensures the source of the down payment, but lenders are required to comply with federal anti-money laundering regulations and may also have their own internal policies for validating the source of funds.
It’s important for buyers to be transparent about the source of their down payment and to work with a reputable lender to ensure a smooth and transparent transaction.
Conclusions and Further Thoughts
Finally, it’s really important to discuss your source of down payment upfront with your mortgage broker or lender. Huber Mortgage has over 10 years of direct lending experience and will help you organize the legitimacy of your down payment, advise on possible obstacles you may face or down payment sources that will not be allowed.
Having a clear and direct discussion will avoid the occurrence of funds being disqualified later on or confusion resulting after funds having been transferred into different accounts, requiring additional supporting documentation.
Call Huber Mortgage for a free, upfront mortgage consultation!
PS – One of my hobbies is blogging about mortgages, debt and government policy. During the day I’m a MORTGAGE BROKER in Kelowna, BC!
Check out the Huber Mortgage Home Buyers Guide HERE