Verification of Deposit.
Written by:
Angelina Johnson,
NAMP Volunteer Writer
One of the more important aspects in an underwriter's decision-making is the financial capability of the borrower. Frequently, it is favorable to show borrower having 6 months reserve. Underwriters will make certain exceptions provided other compensating factors exists like occupancy, years of employment history, years of residence history, etc. Known as a riskier type of ownership are non-owner occupied properties. Property owners tend to let investment properties go first, therefore, more stringent rule applies to this type of loans.
As verification of Deposit (VOD) has its place, so does its credibility. Because of the multiple fraud issues such as alteration of this document, lenders are now doing a verbal verification prior to docs. Their purpose is to ascertain the accuracy of the contents. Another issue lenders are running into is a hand carried verification. When a borrower brought over a Verif to a friend-banker, for example, lenders believe the figures are more likely to be manipulated. Because most major banks now centrally process their verification, anything out of the ordinary will certainly cause a raised eyebrow.
As always, consistency being a key, if you are to assume an asset to state in the 1003 prior to actually receiving any Verification, you must try to get it closest and as accurately as possible. Borrowers who like moving funds to sum up the same funds over and over again will still hit a snag since lenders have always ask for source of funds. This is especially true if the increase is over and above the monthly income. Just remember, having a strong package with lots of compensating factors will always help.
About the Writer. As one of NAMP's volunteer writers, Angelina Johnson is currently a NAMP member in good standing and has applied for her CMLP certification with NAMP. Feel free to email Angelina at: angelina@mortgageprocessor.org. Or, if you would like to become a volunteer writer for NAMP, please email us at: blog@mortgageprocessor.org.
Angelina Johnson,
NAMP Volunteer Writer
One of the more important aspects in an underwriter's decision-making is the financial capability of the borrower. Frequently, it is favorable to show borrower having 6 months reserve. Underwriters will make certain exceptions provided other compensating factors exists like occupancy, years of employment history, years of residence history, etc. Known as a riskier type of ownership are non-owner occupied properties. Property owners tend to let investment properties go first, therefore, more stringent rule applies to this type of loans.
As verification of Deposit (VOD) has its place, so does its credibility. Because of the multiple fraud issues such as alteration of this document, lenders are now doing a verbal verification prior to docs. Their purpose is to ascertain the accuracy of the contents. Another issue lenders are running into is a hand carried verification. When a borrower brought over a Verif to a friend-banker, for example, lenders believe the figures are more likely to be manipulated. Because most major banks now centrally process their verification, anything out of the ordinary will certainly cause a raised eyebrow.
As always, consistency being a key, if you are to assume an asset to state in the 1003 prior to actually receiving any Verification, you must try to get it closest and as accurately as possible. Borrowers who like moving funds to sum up the same funds over and over again will still hit a snag since lenders have always ask for source of funds. This is especially true if the increase is over and above the monthly income. Just remember, having a strong package with lots of compensating factors will always help.
About the Writer. As one of NAMP's volunteer writers, Angelina Johnson is currently a NAMP member in good standing and has applied for her CMLP certification with NAMP. Feel free to email Angelina at: angelina@mortgageprocessor.org. Or, if you would like to become a volunteer writer for NAMP, please email us at: blog@mortgageprocessor.org.
posted by Editor in Chief at 12:34 PM
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