Asset Documentation and Down Payment Verification
All funds used for down payment and closing costs must be sourced and seasoned. Lenders verify assets through bank statements and investment account statements.
What the Lender Requires
- 2 months bank statements (all pages, all accounts)
- Investment/retirement account statements
- 401k/IRA statements if used for down payment
- Gift letter and proof of donor transfer if using gift funds
- Business account statements if using business funds
- Sale proceeds documentation if selling another asset
How CTC Processes Asset Documentation for Mortgages Files
- 01Submit 2 months statements
- 02CTC reviews for large deposits requiring LOE
- 03Confirm sufficient seasoned funds for closing
- 04Identify any sourcing issues
Common Conditions Related to Asset Documentation for Mortgages
- LOE for large deposits (over 50% of monthly income)
- Donor bank statement and wire confirmation for gift funds
- Business account documentation if using business assets
- 401k loan or withdrawal documentation
How CTC Handles Asset Documentation for Mortgages
Asset documentation catches many last-minute surprises. CTC reviews statements thoroughly on intake. If a large deposit needs sourcing or gift funds aren't documented, we flag it before the file reaches underwriting.
Frequently Asked Questions
How long do assets need to be seasoned?
FNMA/FHLMC require 60 days of seasoning for down payment funds. Large deposits in the last 60 days must be sourced. Properly documented gift funds are exempt.
Can I use a 401k for a down payment?
Yes — retirement accounts are counted at 60–70% of value after early withdrawal penalty assumption. A 401k loan payment counts as a monthly debt obligation.
What is a gift letter?
A signed document from the donor stating: amount, relationship, no-repayment intent, and that funds are a gift. Donor's bank statement and transfer confirmation are also required.