How banks trace money in your accounts to prevent fraud, and why some loans require funds to sit in your account for weeks before closing. FHA, VA, and conventional loans have different seasoning rules.
Preparing for a home loan but unsure how to get your funds in your bank account to make everything go smoothly. We're here to help with that. So with a liquid list of your bank statement, they don't care what you spend your money on. They don't care what you went to Taco Bell last Friday night and ordered a bunch of food. They want to know where the money came from that's in your account. Now keep in mind it's just for a 30 or 60 day window. FHA and VA require to trace by 30 days. Conventional is usually 60 days. Sometimes you get lucky at just a 30 day tracing. This is called seasoning of the funds. So they want to know that the money came from a legit source. They pretty much are wanting to prevent money laundering when buying a house. That's why these rules exist. If it's just transfer to another account, no big deal. We just have to get the other account statement if it was within the last 30 or 60 day window there. If it was gift funds from a gifter, no problem. If it's FHA or va, we have to get the gifter's bank statement to show that. If it's cash, that's where it's a little tricky. So talk to us, be proactive. We can help. But usually the name of the game is get the money in early. If you're uncertain about it, let it season for 30 or 60 days. Then we don't have to ask you any questions about it.
