Posted 4 years, 3 months ago

“Large Deposits” are generally considered as any single deposit that exceeds 25% of your monthly income.  For example, if you make $5,000 per month, any deposit over $1,250 would be considered a "large deposit" and would need to be sourced (i.e. you would need to provide a paper trail documenting where the funds came from). 

Why do large deposits need to be sourced?

Large deposits need to be sourced for a few reasons.

  • Was the deposit from a new loan not appearing on your credit report?  If the deposit was from a cash advance or new loan, we will need documentation showing the terms of new loan in order to accurately calculate your debt-to-income ratio.
  • Was the large deposit from a gift?  While gift funds are typically allowed, we will need to verify that the gift was from an acceptable donor (i.e. a relative, fiancé, fiancée or domestic partner).  Additionally, you will need to provide a gift letter from the donor along with documentation demonstrating that the funds came from the donor.
  • Did the large deposit come from a legal source?  We’re required by law to report suspicious activity that indicates money laundering, terrorist financing or other criminal activity might have occurred.

Conclusion

Large deposits can be accepted with proper sourcing and documentation, however they can be a potential obstacle if you’re unable to clearly identify the source of the deposit.  Be sure to call us if you’ve received any large deposits or anticipate receiving any in the near future.  Planning ahead can make all the difference.

-The Kavanewsky Team