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What's Considered A Large Deposit?

Updated: Mar 16

Any single deposit that exceeds 25% of your monthly income is generally considered a “large deposit”.  For example, if you make $4,000 per month, any deposit over $1,000 would be considered a "large deposit" and would need to be sourced, meaning that you would need to provide a paper trail documenting where the funds came from. 


Why do large deposits need to be sourced?


Here are a few reasons large deposits need to be sourced:


The deposit could be from a new loan not appearing on your credit report.  If the deposit came from a new loan or a cash advance, we will need documentation that shows the terms of the new loan in order to calculate your debt-to-income ratio accurately.


Did the large deposit come from a gift?  Although gift funds are allowed in most cases, we will need to confirm that the gift was from an acceptable donor (i.e. fiancé, fiancée, domestic partner, or a relative).  In addition, a gift letter from the donor will need to be provided, along with documentation showing that the funds came from the donor.


We need to confirm that the large deposit came from a legal source.  By law, we’re required to report any suspicious activity that indicates money laundering, terrorist financing or any other criminal activity might have occurred.


Conclusion


While large deposits will be accepted with proper sourcing and documentation, they can also be a potential obstacle if you are unable to clearly identify where they came from.  If you’ve received any large deposits or anticipate receiving any in the near future, please be sure to call us so we can guide you in the right direction.  


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