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Hi I was looking into getting a mortgage is it important when looking at your application to have mo

Hi I was looking into getting a mortgage is it important when looking at your application to have a good chunk of money in your savings account
  • September 25 2013 - Tumwater
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Answers (8)

It depends.  Different programs have different guidelines.  If you are buying a house, have good credit, and are putting 20% down, you will probably only need the down payment plus closing costs.  If you have less than stellar credit, high debt to income ratios, and are putting less than 20% down, you might need to show reserves in the bank.

Talk to a loan officer you trust, and they can find the best program for your situation.

Hope this helps.

  • September 26 2013
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Well it definitely doesn't hurt you! When you are being pre-approved lenders will want to make sure that you have enough money to pay the down payment and closing costs for the loan. They also would like you to have this money as reserves as a "just in case" scenario in the future. So having money in your savings account is definitely a plus!

Well I hope this helps! If you have any further questions or if you would like a loan, feel free to contact me!

Good Luck!
  • September 25 2013
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Enough money for a down payment and any closing costs, credit, and income are all factors in the amount that you will be approved for. Depending on the size of the loan you are looking for will determine where all of those factors need to be. 
  • September 25 2013
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Strong savings, income, and credit are all factors that we look at when evaluating an application for a residential mortgage. There are many programs that will allow you to get into a home with as little as 3.5% down for FHA or 5% down for a conventional loan.
  • September 25 2013
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Profile picture for Brian GFL Capital
looking to get a mortgage like a purchase loan? if so yes you will need to show enough assets to cover the down payment.
  • September 25 2013
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Profile picture for Arizona Mortgage Pro
Hello there, not an easy question to answer without a little more info. Lenders will look at all your assets when assessing your loan application. If you are asking whether or not which account you have them in matters (i.e. checking vs. savings), the answer is sort of. All liquid assets are considered at face value, so checking vs. savings are considered the same, but retirement and other non-liquid assets are reduced a little to compensate. 

If you are asking whether or not you would need a lot of extra money after closing the mortgage transaction, it depends on the loan program and your credit profile. The money left over after the transaction is referred to as reserves. If you are buying a primary residence and your credit profile is strong, you may only need minimal reserves. If you are buying an investment property and your credit profile is borderline, you may need to show plenty of reserves. 

We are all happy to help with any general questions, but it is always best to consult with a reputable mortgage professional in your area regarding your specific situation.
  • September 25 2013
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Profile picture for daveskow
you will want to show adequate funds for closing PLUS   several months of payment reserves

if you dont have it  now .. but plan to have it in place in near future ..many lenders  / loan officers can  work out a plan of atack  with  this detailed  knowledge

If you have already made the application - ask the lender you are working with this  question


I hope this helps
  • September 25 2013
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We only require 2 months reserves usually depending on your situation.  So the answer to your question is it really doesn't matter if the balance is way above that.  That isn't a factor in underwriting.
  • September 25 2013
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