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Verifying Assets To Qualify For A Mortgage
Verifying of Assets For a Mortgage in Cape Cod
When applying for a mortgage in Cape Cod there is a list of things that helps qualify a borrower.
Assets are one of the many key components that Cape Cod lenders take into consideration when reviewing a borrower’s financial circumstances.
There are different types of assets that you can list that can help with qualifying for a mortgage in Cape Cod.
Types of Assets
Cape Cod lenders usually verify assets (liquid assets) just to make sure that the borrower has enough funds for closing. The final transaction usually requires down payment, closing costs, and prepaid items. There may be fees for total reserves that is required for the underwriting approval. There are many different types of assets allowed, below is a list of a few common ones:
Common Assets
- Stocks
- Earnest Money
- Bonds
- IRA/401(k)/Retirment accounts
- Checking and Savings Accounts
- Investments
- Selling of non-liquid assets
- Gift Funds
When loan program guidelines require Cape Cod lenders to verify assets, they usually require that they source and season. To source assets (sourcing assets) usually means that the lender must verify where the funds developed from. To season assets (seasoning assets) is to verify that the list of assets have in fact been in the account for about 2 months at least.
Reserve Requirements in Cape Cod
Reserves are also referred to as the amount of “liquid assets” that you would have left over after closing. When verifying Reserves, lenders usually look at reserves as equivalent to numbers of months that can cover the Principal, Interest, Taxes, and Insurance(monthly insurance if necessary), these are usually referred to as PITI.
Requirements for reserves do vary depending on the particular loan program (debt-to-income and credit score). To find out exactly how many months you have to have your reserves you should always check with a qualified Cape Cod lender.
