Mortgage  Question?
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Funds from Multiple Accounts for Down Payment on a Home

Can you use funds from multiple accounts for the down payment on a home? I have funds in a savings, checking and investment account that I want to use for my down payment.

Harry Jensen, Trusted Mortgage Expert with 45+ Years of Experience
, Trusted Mortgage Expert with 45+ Years of Experience

The short answer to your question is yes, you can use funds from multiple accounts to pay for the down payment on a home as long as you provide the proper documentation.

To verify the sources of funds for a down payment, lenders typically require that you provide two months of statements for any account that you use -- be it a savings, checking or investment account. The funds can be sourced from multiple accounts as long as the money has been held, also known as seasoned, in the account for at least two months.

Lenders review your account statements to confirm that the money you use for your down payment is from your own personal funds and not a loan that needs to be repaid. You can use the statements provided by your bank or investment company or you can download the most recent statements online.

Use ourDOWN PAYMENT CALCULATORto determine the funds you need for the down payment on a home

Please note that if you intend to use funds from a investment account for your down payment and closing costs, if the value of the stocks, bonds or other assets held in the account is not at least 20% more than money you need, then you are required to sell the assets and provide proof of receipt of the proceeds from the sale to the lender.

For example, if your down payment and closing costs are $30,000 and you have $32,000 in stocks (less than 20% more than the funds you need) in a brokerage account, you need to sell $30,000 in assets and provide documentation of the transaction to the lender.

From the lender's standpoint, using stocks or other assets for your down payment creates the risk that the value of those assets declines over the course of the mortgage process and you may not have sufficient funds when it is time to close your loan. Therefore, you are required to sell the assets to show that the funds are readily available.

If the value of assets is at least 20% more than the funds you need, then you are not required to provide documentation to the lender, although you need to sell the assets required to pay your down payment prior to closing. In this case, the value of the assets is high enough that you can still pay for your down payment even if the assets decline in value -- at least up to a 20% drop -- so the qualification requirement is more lenient.

In closing, you can definitely use funds from several accounts to pay for your down payment as long as you provide the necessary documentation. In most cases the funds are required to be in your account for two months before your mortgage closes and in some cases you may need to sell assets in an investment account to qualify for the loan.

The table below shows mortgage terms for leading lenders in your area. We recommend that you contact multiple lenders to confirm their down payment requirement. Shopping lenders is also the best way to save money on your mortgage.

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Current Mortgage Rates in San Diego1, California1 as of December 3, 2020
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Data provided by Brown Bag Marketing, Inc. Payments do not include amounts for taxes and insurance premiums. Read through our lender table disclaimer for more on rates and product details.

Sources

"B3-4.2-01, Verification of Deposits and Assets."  Selling Guide: Fannie Mae Single Family.  Fannie Mae, April 25 2017.  Web.

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About the author
Harry Jensen, Mortgage Expert

Harry is the co-founder of FREEandCLEAR. He is a mortgage expert with over 45 years of industry experience. Over his career, Harry has closed thousands of loans for satisfied borrowers and now offers his advice and insights on FREEandCLEAR.  Harry is a licensed mortgage professional (NMLS #236752). More about Harry

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