Source of funds

A funding analysis that investigates the true origin of the funds that the buyer or borrower is using. For example, conforming residential lenders require full documentation of the source of funds, including two months of bank statements and explanations for any large deposits. Underwriters perform this review to ensure that the borrower's funds are legitimate and do not come from unallowed sources--such as hidden loans, which increase the borrower's debt load. For more information, see the "Analyzing Assets" article in the "Loan Process" section.

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Real Estate 101

Real Estate 101

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