Proving Income By Bank Statements

[aints68]

Maybe someone here can answer this. On loans where they are willing to use past bank statements as proof of income, what are they looking for.

I do contracted work and put all my checks in the bank, but then i also pull a lot of that money out to pay bills, food, etc.

Are they looking just at whats coming in, or are they looking at ending balances?

[willingtocope]

For proof of income, they'll look at deposits. But, while they're at it, they'll also take note of what you spend it on....

[harleygirl]

I got a vehicle loan this way. I bank online and do not receive paper statements.

My bank allows me to chose "deposits" and see only that. I printed it right in the dealership.

It will most likely depend on the lender.

[aints68]

Thanks for the replies so far. I'm just afraid as this will be for a mortgage, they may want me to account for everything that I withdraw as well as deposit.

[Moneedshelp]

see if it is possible to receive a "statement" of deposits only

[willingtocope]

Thanks for the replies so far. I'm just afraid as this will be for a mortgage, they may want me to account for everything that I withdraw as well as deposit.

Is that a problem? Are you doing withdrawals for something you don't want them to see?

[firstsource]

The investor/lender will want to see complete bank statements, for 12-24 months depending on the program. When I say all pages, even if the last page is an ad, they will want to see that page also.

They are looking for several things.

1) do you bounce checks? Though they won't deny your loan because of that, they will think of another reason to tell you.

2) Are there a lot of withdrawls or transfers to another bank account? They will then try to determine if you are then just putting the money back into that account and counting that as deposits of new money.

3) For some reason, they also are wary of even money deposits. In the scheme of things those are unusual, so if you show those on a regular basis, you will have to explain that.

Charles

[oompaloompa]

to my knowledge the lenders that do use bank statements for income documentation (rather than asset documentation) are fairly limited. To mind comes only some Alt-A or portfolio loan products (most likely not conventional/fannie mae or government stuff).

in any case to add to what firstource says above,

they are usually going to take a 12 or 24 month average of deposits. what they look for in the statements depends on what they are being used to prove. for income they will be looking to make sure all deposits are from an acceptable source and that there are no unusually large deposits, and that there is no personal mixed with the business. they will also be on the lookout for NSF's and overdrafts a few here or there is explainable but a pattern is not. in general for income nobody cares about withdrawals unless there is a strange pattern(frequent large transfers to another account, huge unexplained cash withdrawals, strings of atm transactions at the casino8-))

to shed any more light on the matter we would need to know more about your loan in process (if you are that far), the lender it's with, and the specific loan program you are applying on.

[2ndTimeAround]

The investor/lender will want to see complete bank statements, for 12-24 months depending on the program. When I say all pages, even if the last page is an ad, they will want to see that page also.

They are looking for several things.

1) do you bounce checks? Though they won't deny your loan because of that, they will think of another reason to tell you.

2) Are there a lot of withdrawls or transfers to another bank account? They will then try to determine if you are then just putting the money back into that account and counting that as deposits of new money.

3) For some reason, they also are wary of even money deposits. In the scheme of things those are unusual, so if you show those on a regular basis, you will have to explain that.

Charles

Charles is right above - in the past when I did loans with bank statements, the first thing that is looked at is the average deposits over a 12 month period to calulate. There are fewer banks that allow bank statements.

If you are self employed, most banks want to see your tax returns...

Good Luck.....