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Thanks to anyone who reads this short post.  As the title states, I have deposited a small money gift to my nephew to help with closing costs on his first home, my bank and I have both signed a gift letter stating the funds were already in there before I wrote the check, but now the processing agent wants to see my last bank statement to prove the funds, even though my bank signed the legal gift letter.  I really don't want the processing agent or others in that food chain to know how much money I have in that account, so the question is.... Is there another way I can convince the agent regarding my bank account without sending them the statement?  In an email exchange with them and my nephew they said without the statement they will not accept that money in his account as being his to use.  Is there a way or am I stuck 'raising my skirts' to help my nephew?

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Comment Preferences

  •  I have no idea what you're even talking (1+ / 0-)
    Recommended by:
    zmom

    about but how about starting over - he gives you the money back, you open a new account or something and then hand it over with the right documentation before writing the check? Or, if time is of the essence do it with some of your own money then he can give you back the original amount at his leisure?

    •  from the email exhange with nephew and agent.. (2+ / 0-)
      Recommended by:
      Heavy Mettle, Temmoku

      I am running into a snag with the loan processor.  I requested that she talk with your Banker in regards to the paper trail and this is the response below I received from her.

      *We do have the signed gift letter from your aunt, but in order to consider a complete paper trail you need to provide us with your aunt’s bank statement prior and after the withdrawal to proof she had the funds and it cleared her account, in this cases we don’t need donor’s complete bank statement, but we need to make sure the pages provided shows the following information;
      a) Account number (to verify info with gift letter)
      b) Donor’s name (to verify info with gift letter)
      c) Balance available (prior to donation)
      d) Proof donation check cleared her account

      Hi Mr.
      I asked management and we are not allow to take a verbal from your aunt’s banker, we will need your aunt’s statements as I requested in my prior email, this is the only way we can clear that condition, if for any reason your aunt is not willing to provide you with it, we are not allow to consider the funds even when they are already deposited therefore you will short funds to close.

    •  That doesn't work...banks want proof of (2+ / 0-)
      Recommended by:
      Heavy Mettle, zmom

      where the money came from.  A new account with a recent transfer wouldn't work, since they'd see it, and the question would remain.  If the account had the money in it for a few months, that would, in fact, do the trick.

  •  How about a money order (3+ / 0-)
    Recommended by:
    zmom, Lujane, elmo

    where it's more like cash and less like a check that has to clear?

    Or,  a new JOINT account could be a really quick and smooth way to go.

    "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

    by lgmcp on Fri Aug 09, 2013 at 03:33:29 PM PDT

  •  um... NO. (2+ / 0-)
    Recommended by:
    Actbriniel, zmom

    Dudehisattva...

    "Generosity, Ethics, Patience, Effort, Concentration, and Wisdom"

    by Dood Abides on Fri Aug 09, 2013 at 03:37:21 PM PDT

  •  Bank Check, Cashiers' Check, or Wire Transfer Woul (6+ / 0-)

    be my thoughts about proceeding.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Fri Aug 09, 2013 at 03:43:00 PM PDT

  •  Processing Agents reason for asking (13+ / 0-)

    It's always good to ask exactly what their concern is when they ask for information.  It eliminates miscommunication.  As a former mortgage banker, my guess is they are concerned your check will bounce.  Did your nephew deposit your check recently?  

    That being said, the closing process usually requires cashier's checks, so really what the processing agent needs is verification from your nephew's bank that the funds are available for the closing.  

    Asking for a copy of your bank statement when you are not a party to the loan sounds off.

    But keep in mind that each state has different banking laws.  I'm in Texas.

    We are all in this together.

    by htowngenie on Fri Aug 09, 2013 at 03:43:04 PM PDT

    •  This jibes with my own experience in CA, too. (6+ / 0-)

      The diarist should find out what the concern is before handing over any unnecessary documentation.

      Saint, n. A dead sinner revised and edited. - Ambrose Bierce

      by pico on Fri Aug 09, 2013 at 03:57:37 PM PDT

      [ Parent ]

    •  thank you for the advice... I had a cashiers (3+ / 0-)
      Recommended by:
      Lujane, OldDragon, Chi

      check deposited into my nephew's bank two days ago, there is a transaction receipt for that.  My banker signed a gift letter stating I had more than those funds in my account, which seems to be the crux of the situation.

      He is seeing the funds in his account, so it is about some weird issue regarding whether or not I had those funds in my account prior to gifting it to him.  Check out the email exchange in above response.

      •  That just doesn't make sense. (4+ / 0-)
        Recommended by:
        zmom, Lujane, gffish, Chi

        You can't even get a cashier's check if you don't have the funds to purchase one. And the cashier's check is now written from the bank, not your own account.

          •  You are correct. (8+ / 0-)
            All gift funds must be fully documented. There has to be proof that the funds belong to the donor, and it must be clear where the money came from. For example, a bank statement showing the money in the donor’s account, combined with a withdrawal slip or check made out to the buyer, is proof. So is a loan document made out to and signed by the donor. Both the donor and buyer must sign a letter stating the name, address and phone number of the donor, along with the dollar amount, type of relationship between the donor and buyer and statement that there is no repayment requirement for the money. Proof of the buyer receiving the money, such as a deposit slip or bank statement, must be supplied by the buyer.
            bold emphasis mine

            It seems that even though you had a cashier's check made and a bank letter to verify the money was yours the loan processor still needs this paper trail to prove the gift came from you.

          •  Not a rule, exactly (1+ / 0-)
            Recommended by:
            zmom

            but an example of how someone might establish that the funds used for a gift do indeed belong to them (of course, a bank statement is not actually proof of that, but we'll let that slide).

            The problem is that people sometime get so fixated on an example that they decide it has become a requirement.

            •  They need some sort of receipt. I highly doubt (2+ / 0-)
              Recommended by:
              SoCalSal, zmom

              that a letter is acceptable.

              •  You're probably right (1+ / 0-)
                Recommended by:
                zmom

                but not because a copy of the bank statement is genuine evidence of anything. It isn't. It doesn't even prove that the funds in the account are collected, or won't be charged back or otherwise removed from the account. There could be outstanding checks that will hit the account before the gift check, for example.

                A copy of the bank statement will be accepted because it's listed as an example of what is acceptable.

      •  2 days not enough... (1+ / 0-)
        Recommended by:
        Lujane

        Believe it or not, holds can be placed on cashiers checks in certain circumstances.  Not knowing your nephew, I can't say what his bank did regarding making the funds immediately available.  But I still think that the availability of funds is what the processor is concerned with at this point.
        When is the closing scheduled?

        Regarding the email exchange, it's always helpful to have literate people communicating these issues but, alas, it doesn't seem to be the case here.  

        FYI - The funds for the downpayment typically have to be in the account of the borrower for at least six months to prove they saved up for the down payment on their own.  Otherwise, a gift letter is required to show they aren't borrowing the downpayment from a third party.  Diarist has already said she provided the gift letter, so that is not the issue here.

        We are all in this together.

        by htowngenie on Fri Aug 09, 2013 at 04:23:26 PM PDT

        [ Parent ]

      •  If he is getting a FHA loan (4+ / 0-)
        Recommended by:
        zmom, SoCalSal, Chi, raines

        and you "gift" him money within the past 60 days or so... or whatever the time frame is now... it could be 90 days... you must sign a form and provide your personal bank account information.

        If he could wait 58 more days to close the loan... then you wouldn't have to go through this.


        A society grows great when old men plant trees in whose shade they know they shall never sit.

        by bronte17 on Fri Aug 09, 2013 at 05:03:24 PM PDT

        [ Parent ]

    •  I think they ask this question because they (2+ / 0-)
      Recommended by:
      tacklelady, zmom

      want to be certain that neither you nor your nephew borrowed the money from elsewhere to make it possible for your nephew to purchase a home. That is, that it isn't actually a gift but a loan that you will need to be repaid from the same resources they are expecting future mortgage payments to come.

      Every time we've purchased a home in the US (and there were five over many years) we were required to demonstrate that the money we used for the down payment and other up-front costs was NOT borrowed, constituting another debt on our personal financial statement.

      Perhaps they would be satisfied with an affidavit (sworn statement) from your bank that, one month before making the gift to your nephew, your personal bank balance "exceeded X." Or that over a period of X months, your balance as "exceeded X" with the latter X being a number substantially higher than the gift, but not necessarily as high as the amount you hold and would prefer to hold privately.

      The good we secure for ourselves is precarious and uncertain, is floating in mid-air, until it is secured for all of us and incorporated into our common life. Jane Addams

      by Alice Olson on Sat Aug 10, 2013 at 06:39:28 AM PDT

      [ Parent ]

      •  Believe it or not... (1+ / 0-)
        Recommended by:
        zmom

        some people would lie about where the money came from.  

        Why does it matter?  Well, you need more income to pay back borrowed money, and none to pay back a gift.

        If you want to know the real answer: Just ask a Mom.

        by tacklelady on Sat Aug 10, 2013 at 07:01:18 AM PDT

        [ Parent ]

  •  I'd go with... (2+ / 0-)
    Recommended by:
    jayden, zmom

    Another lender, because I'm willing to bet that after you've jumped through this hoop there will be another right behind it.                              

  •  The lender needs to see that my nephew has (6+ / 0-)

    the funds for all the costs, a gift is appropriate, a loan is not.  I was only asked within the last week when my nephew was told a higher number for the closing costs than he was anticipating, so it is too late to set anything up as was described above.  Also, they are requiring a paperwork trail of all his money/account/ gifts - it is a FHA loan, man it definitely wasn't like this when we bought our home from a regular lender.

  •  There is some issue about making sure there is no (2+ / 0-)
    Recommended by:
    Heavy Mettle, Lujane

    laundering of money between my nephew and myself, really stupid-why would he give me the money so I could then gift it to him?  What am I missing.  They want to see I had more than the funds I gave him in that account, so starting a new account would not fly.  

    •  Well, if they are really determined (2+ / 0-)
      Recommended by:
      jayden, zmom

      to verify not only that the money is real, but that you can afford to give it, then I think you will have to let them pry into your affairs.  

      "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

      by lgmcp on Fri Aug 09, 2013 at 03:54:36 PM PDT

      [ Parent ]

    •  Once the money's cleared by the bank (3+ / 0-)
      Recommended by:
      tardis10, jayden, zmom

      and they've verified that the funds have come from you as a gift, they shouldn't need the extra information on your account.  You're no longer part of the story.

      If they're asking, they're either a) overstepping their boundaries, or b) they have some reason for concern about where the money's coming from.  I'd echo htowngenie's recommendation above: ask for clarification on why they need this information, and do your best to sort it out without giving them your bank statement, which should be unnecessary.

      Saint, n. A dead sinner revised and edited. - Ambrose Bierce

      by pico on Fri Aug 09, 2013 at 03:54:55 PM PDT

      [ Parent ]

      •  Clarifications sounds like a great idea nt (0+ / 0-)
      •  You are wrong about this (1+ / 0-)
        Recommended by:
        zmom

        the lending laws for FHA says they must verify this to prevent money laundering.  THey are not overstepping their boundaries, and they are not going to share the information.  This is not the good old days when "gift letters" which were really loans were done all the time.  They really want to see if you can afford this gift or if this is possibly illegal funds from, for example, drug money, that is being laundered through the mechanism of a home purchase.  You HAVE to comply, and stalling is only messing up your nephew's escrow and probably causing him to close late and incur penalties from the seller or the bank regarding rate locks. There is no way to avoid this without withdrawing the gift which will cause your nephew to lose the house.

        The GOP -- Hating Women, Gays and People of Color since 1854

        by Former Chicagoan Now Angeleno on Fri Aug 09, 2013 at 08:47:00 PM PDT

        [ Parent ]

    •  I think I know what you're missing, though -- (2+ / 0-)
      Recommended by:
      zmom, johnny wurster

      People have to show certain income to qualify for their loan and demostrate how they will make ongoing payments, plus come up with a certain down-payment.  But some people want to take out a larger loan than they would necessarily qualify for.  They figure they can just tighten their belts and pay more than the formulas predict they can.  So they get a fake gift that's really a loan, and later they pay back the lender via belt-tightening.

      "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

      by lgmcp on Fri Aug 09, 2013 at 03:57:42 PM PDT

      [ Parent ]

      •  My sister and her husband actually did this (1+ / 0-)
        Recommended by:
        zmom

        about 20 years ago now.  They saw a house they really, really fell in love with and thought it was hot deal, but it was out of their range.  So they got a fake gift from her husband's boss.  

        "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

        by lgmcp on Fri Aug 09, 2013 at 03:59:27 PM PDT

        [ Parent ]

    •  If your nephew were a drug dealer (0+ / 0-)

      and for example, gave you the funds so that he could put them into his house without having to ever show them on his income tax, and if you didn't have to prove they were in your bank, thus never triggering anything on your income tax, then buying a house would be an excellent way to hide money.  This is why you MUST show the bank statements.

      The GOP -- Hating Women, Gays and People of Color since 1854

      by Former Chicagoan Now Angeleno on Fri Aug 09, 2013 at 08:48:38 PM PDT

      [ Parent ]

  •  Lenders are required... (11+ / 0-)

    to trace the source of money for down payments and closing costs.  Generally they look back 60 to 90 days.  They just need to establish that the money was really yours to gift and it didn't come from another loan or other inappropriate source.  They aren't interested in how much additional money you might have in the bank.

  •  My banker is calling the proccessing (1+ / 0-)
    Recommended by:
    OldDragon

    agent as we speak, for said clarification.  I am probably being too cautious, but the days are gone when only two or three people between two banks are looking at all that stuff, now who knows how many eyes are on all that paperwork - especially since they are asking for my account number as well as amount.  I figure I will press as hard as I can before giving in 'to the man'.

    •  Did you read this response to another (2+ / 0-)
      Recommended by:
      htowngenie, worldlotus
      •  looks like FHA is requiring the stmt. (3+ / 0-)
        Recommended by:
        worldlotus, zmom, johnny wurster

        To prove you didn't borrow the money from your bank to "gift" to your nephew.  

        Makes sense to me, but it's not a typical request in a conventional loan.

        We are all in this together.

        by htowngenie on Fri Aug 09, 2013 at 04:32:59 PM PDT

        [ Parent ]

      •  Yes, looked at that, thank you... (0+ / 0-)

        my nephew understood that what was needed was the gift letter to be signed by myself and my banker, but he, nor I, were versed in the other paperwork trail being asked for now.  It seems my nephew has been getting hit with the "this it what you need, no, now this is what you need, no, we now want this from you."  I only became involved when he was told last minute a higher closing cost than what he thought or was told earlier.  If the numbers had been what he originally knew to be accurate he wouldn't have needed anything from me.

        •  He actually may have some recourse on this (1+ / 0-)
          Recommended by:
          zmom

          the RESPA laws require that the mortgage banker must, within 3 days of application, provide an accurate good faith estimate of costs.  Some costs cannot change from the GFE, others have some tolerance but it isn't much.  Depending on what changed, he might be able to force the lender to "eat" the changes.

          The GOP -- Hating Women, Gays and People of Color since 1854

          by Former Chicagoan Now Angeleno on Fri Aug 09, 2013 at 08:59:08 PM PDT

          [ Parent ]

    •  we just refinanced our house last month, and went (3+ / 0-)
      Recommended by:
      zmom, Chi, Flying Goat

      through a similar mess, with the lender at the last minute demanding documentation that the cashier's check we got from our bank to pay the closing costs (as instructed) had actually been withdrawn from our account there. I had to log on to my bank account and print out a page showing "recent transactions" that included the withdrawal for the cashier's check. Even though they had the check right in front of them, clearly withdrawn from our bank account.

      I thought it was all incredibly stupid, but we gave them the paperwork. At that point why not, they had everything else! Anyway I think this kind of run-around on unnecessary paperwork seems to be just part of the process these days. Hope you find a way to work it out. Very nice of you to help your nephew out! Good luck.

      •  That sounds truly bizarre to me. (1+ / 0-)
        Recommended by:
        zmom

        I closed on a condo two weeks back, and there was no such requirement made of me.  Bank did want to see bank statements recent enough to show me bouncing all my money around into a single account, though, which seems kinda silly, since they had already confirmed I had enough to cover the down payment.

  •  You have to "gift" the funds to your nephew (4+ / 0-)
    Recommended by:
    zmom, OldDragon, Chi, Demeter Rising

    with no strings attached.

    I would presume you would have already given him the Cashier's Check and he deposited it into his own account in his own name.

    There is a form that spells this out, but if I remember correctly... it does require that you provide them with your personal account number. I loath the TBTF banks and their intrusiveness. Cash gift transferred is cash transferred. They'll tell us this is for "our own protection" so that drug cartels and prostitution rings can't bring down our nation.

    I would never give the processing agent access to my account since you are not the one buying the home.

    If your nephew can wait a couple months... and put a clause in the contract to buy that it is contingent on financing... give him the money and wait a couple months. Then it's his money and no form or information from you is needed.

    And, just for the record which is a little off topic, but major lenders are outsourcing the servicing of their mortgage loans to subprime companies. Supposedly because Congress instituted a higher capital requirement on them.

    The subprime SOBs and their CEOs are coming out of the woodwork and establishing themselves as SERVICERS OF OUR MORTGAGE LOANS and renaming/rebranding themselves after they've gone through 3 bankruptcies. For people with 45% equity, conventional loan and 800 credit score. Subprime takes over. I guess Wall Street didn't get enough of us the last time around.

    JPMorganChase is doing it, as well as the other big lenders.

    If your mortgage is sold... you need to be very careful about how your make your first few payments during the transfer because the mofos aren't fully established and they don't honor your previous auto payment setup nor do their instructions to use a PO Box give you signed confirmed delivery and date of your payment.

    During the first 60 days from the date of transfer... you can legally continue to send payments to your old mortgage servicer but they will close down your online account.

    Make sure you only send payments to a physical address NOT a PO Box and get signed delivery confirmation. Until the first couple months have passed and they have provided you with an online account. I wouldn't even use their automated system either. I'd log on to the account at the end of each month and send them the payment. Each month.


    A society grows great when old men plant trees in whose shade they know they shall never sit.

    by bronte17 on Fri Aug 09, 2013 at 05:00:04 PM PDT

    •  Cashier's check deposited and showing (1+ / 0-)
      Recommended by:
      Ninepatch

      in his account, legal gift letter signed by myself and my banker, claiming funds in bank prior to gifting.  This particular letter didn't ask for my account info, so after my nephew sent it signed to the agent, now they want my account number, two statements, one prior and one after(too soon for that so I guess a transaction receipt would work) and as I said above, God only knows how many people see this paperwork these days.  My banker is contacting the agent so we will see where this goes.  All this for a very small amount of money to help with closing costs-yeesh; I am with you all the way regarding our modern day mafia styled banking system.

      •  There is NO privacy and your information (1+ / 0-)
        Recommended by:
        zmom

        and bank account info will be shared. You can count on it.

        And they claim they do it "for our own good... to protect us from drug cartels and terrorists." Bullshit.

        That's why I said the only way around this... will be to either plan in advance and gift a relative the money TWO OR THREE MONTHS prior to their mortgage loan process.  Or open yourself up to the bank's sharing of your private information. Because they will share it.

        It's been built into our system now over the past twenty years that Congress refused to provide us with any privacy.

        Anyway, your nephew has obviously already signed an offer to purchase contract?  And he's trying to get the loan wrapped so he can close on the house?

        He won't want to slow down the process. Plus the loan officer won't want to re-up the rate lock for 60 days.

        My condolences to you for the damn bank network spying and also Good for You for stepping up for your nephew. It's a small kindness that will have big rewards down the road.

        The best to you both.


        A society grows great when old men plant trees in whose shade they know they shall never sit.

        by bronte17 on Fri Aug 09, 2013 at 07:10:58 PM PDT

        [ Parent ]

        •  Thank you for taking the time to post and (0+ / 0-)

          for your kind and knowledgable words.  My banker left the agent a message and will try again on Monday, I am holding out hope that she can get this done without the statement but we will see.  Now I feel a little stupid for thinking the signed gift letter would be enough, I should know better, but this is a last minute situation and I will cave into the lender if necessary because my nephew has worked very hard for this.

        •  Yea, they will pass this info along when/if (0+ / 0-)

          they sell the mortgage to someone else.

        •  There are extensive (1+ / 0-)
          Recommended by:
          zmom

          compliance requirements for banks related to money laundering.  These regs have been in place for years, and have been updated to keep up with current conditions.

          The banks have a stranglehold on the political process. Mike Whitney

          by dfarrah on Sat Aug 10, 2013 at 08:51:59 AM PDT

          [ Parent ]

          •  Yet the TBTF banks launder billions $$ in drug (1+ / 0-)
            Recommended by:
            zmom

            cartel money every year.

            As does the Vatican Bank.

            How is that possible that the big boys get to play by different rules while the millions of little people and their little $2k loans to a family member are subject to strict scrutiny?


            One does not become enlightened by imagining figures of light, but by making the darkness conscious. --Carl Jung

            by bronte17 on Sat Aug 10, 2013 at 03:49:21 PM PDT

            [ Parent ]

            •  Well, I didn't (0+ / 0-)

              say they were being enforced very well or that entities can't figure out ways to get around the regs.

              And I'm sure the Vatican bank is not even subject to US laws [does it operate in the US?]

              The simple fact is the diarist needs to give the lender the statements to meet some FHA requirements [assuming that other posters are correct about the FHA regs].

              The banks have a stranglehold on the political process. Mike Whitney

              by dfarrah on Sun Aug 11, 2013 at 08:47:10 AM PDT

              [ Parent ]

      •  this is about federal regulation, not (3+ / 0-)
        Recommended by:
        Susan G in MN, zmom, dfarrah

        the banks.

        its why so many bankers, and even/especially small community bankers, are republicans.  they don't like this sort of regulatory overkill.

        people here tend to be all rah-rah regulation until they have to deal with it.

  •  Well, looks like I am not hearing back (2+ / 0-)
    Recommended by:
    Chi, MRA NY

    from my banker today, so should know tomorrow if I have to five more info.  
    Just wanted to post a thank you to everyone who gave thoughtful replies and offered advice so quickly.  I thought maybe I was going to have to respond to my nephew right away and didn't have time to research myself(so I tried out the orange brigade and you all didn't disappoint), but alas I haven't heard from him since the email so I guess it wasn't so time sensitive after all.  Thank you anyways, and hopefully I can return the favor to the Kos online community.

  •  you'll have provide the statement. (1+ / 0-)
    Recommended by:
    zmom

    I went through an identical episode a year ago, and I think the statement had to be furnished.

    •  actually, maybe we used something else. (1+ / 0-)
      Recommended by:
      zmom

      we may have gotten a transaction report for the amount.  the banker can run a search so that the only thing that shows on the report is the outgoing transfer.

      •  That is what my banker is going to discuss (0+ / 0-)

        with the processing agent on Monday.  She is not happy that they want my account number as well as amount in the account.  My name is on the account/statement, why need the account number as well.

  •  If you want the mortgage company to grant the loan (2+ / 0-)
    Recommended by:
    Susan G in MN, johnny wurster

    you have to comply.  Thorough underwriting standards are a good thing, have we forgotten the wholesale mortgage fraud that so recently decimated the world economy?  

    "Because I am a river to my people."

    by lordcopper on Fri Aug 09, 2013 at 08:13:12 PM PDT

    •  Actually, it's not a good thing.... (1+ / 0-)
      Recommended by:
      zmom

      Requiring complete financial disclosure from third parties in a system with no privacy guarantees can only be a bad thing.

      •  There is no right to privacy when you are (0+ / 0-)

        requesting an extension of credit, whether you are a borrower or an interested 3rd party.  If you want the loan , you must comply by providing the relevant documentation.  I'm curious, how "potentially" would the diarist's privacy be violated in a situation such as this.

        "Because I am a river to my people."

        by lordcopper on Sat Aug 10, 2013 at 08:16:16 AM PDT

        [ Parent ]

        •  See the part about privacy guarantees... (1+ / 0-)
          Recommended by:
          zmom

          It's not at all clear who will end up getting their hands on the information, or what safeguards are in place.

          And yes, if you are giving someone money to help with their downpayment, or even if you're the person taking out the loan, guarantees about how the information will be used, and promises to dispose of financial documents no longer needed after closing are appropriate (Do they really need to keep your bank statements, or those of third parties, around after closing?  Even if so, enforceable and auditable guarantees about who has access to private information strike me as pretty reasonable, given the confidential information they demand)

          •  Who other than regulatory authorities monitoring (1+ / 0-)
            Recommended by:
            zmom

            compliance would possibly want to see the diarist's bank statements?  I'm interested in what you think could possible happen.

            "Because I am a river to my people."

            by lordcopper on Sat Aug 10, 2013 at 11:52:26 AM PDT

            [ Parent ]

            •  It's not a question of who wants to... (1+ / 0-)
              Recommended by:
              zmom

              No one wants to look at naked pictures of me (just take my word for it), but I wouldn't want them floating around in the internet, or in a bank's database, accessible by who-knows-who, passed along with my mortgage, as it changes hands in a rather opaque, and possibly not always legal manner.

              •  A mortgage is a tradeable financial instrument, (1+ / 0-)
                Recommended by:
                zmom

                able to be bought and sold without changing terms to the borrower or lender.  That liquidity reduces the risk premium of lending long term which would otherwise be passed on to the borrower in the form of a higher rate.  Given this reality, any documentation required to justify the original extension of credit (bank statements verifying a gift) must be included with the original documentation for compliance monitoring purposes.  However, I would agree that any distribution of private information outside of necessary channels should be criminally sanctioned.

                "Because I am a river to my people."

                by lordcopper on Sat Aug 10, 2013 at 12:24:43 PM PDT

                [ Parent ]

                •  Great...So hold on to the mortgage... (1+ / 0-)
                  Recommended by:
                  zmom

                  Or provide a legally binding document the contains a summary of the relevant, and only the relevant, details that makes the bank responsible for any inaccuracies.

                  It wasn't fraud by consumers that cause the mortgage crisis, it was the fact that banks had no financial interest in mortgages after they'd sold them off.  Either of these would address that problem.

                  •  Anything that reduces the liquidity of a mortgage (0+ / 0-)

                    loan (the ability to buy and sell the asset) will cause an increase in rates.   So you must weigh the effects of the policy you're advocating.

                    An reasonable observer will acknowledge that borrowers also played a role in in the subprime debacle.  Homeowners refinanced and borrowed too much and when values went down everyone who was caught underwater was left without good options.  The banks have a lot of blame in this situation, but borrowers are not without fault.

                    "Because I am a river to my people."

                    by lordcopper on Mon Aug 12, 2013 at 08:36:32 AM PDT

                    [ Parent ]

          •  Yes, you have explained how I am (1+ / 0-)
            Recommended by:
            Flying Goat

            feeling better than I have been for myself.  If it was the good ole days when one bank would be giving the info to another bank and staying there, I wouldn't feel so uncomfortable with giving the statements, but nowadays when goodness knows how many people over a course of a few years could know that info, it is just an uneasy feeling, and since MY BANKER is not comfortable with the request for the actual account number on top of the statements' amounts then why shouldn't we push back a little.  I guess I am getting a little tired of all the 'required complying' I have been doing lately in being a citizen of this country.  Thanks for articulating what I am feeling.

  •  It is required (3+ / 0-)

    I am a REALTOR and we run into this all the time.  They are trying to prevent people buying homes with money that is essentially being laundered, using the home purchase to clean it up, and then sell the home again and have the money now "clean".  Therefore, there generally has to be "seasoning" to prove that the money was in the bank at least 2 months and where it came from.  Even moving money between accounts can result in then having to provide 2 months statements for both accounts.  I recommend to clients that if their money is scattered around, then either leave it scattered or move it all to one account two months before you make an offer so that the traceability doesn't become a nightmare.

    The GOP -- Hating Women, Gays and People of Color since 1854

    by Former Chicagoan Now Angeleno on Fri Aug 09, 2013 at 08:41:09 PM PDT

  •  Understand why they want this info (2+ / 0-)
    Recommended by:
    zmom, johnny wurster

    I've seen a few comments here that the reason they want to see this info is to prevent "laundering" of money.

    It's actually a little more simple than that.

    When your nephew was approved for a loan, it was based on the idea of his credit, his indebtedness and ability to pay.

    Sometimes people get mortgages, but to "make ends meet" they take out additional loans. That, however, changes their credit profile.

    They are trying to make sure that this additional money was not borrowed by your nephew. Therefore they have to prove to themselves that this really is your money and not his money, and that it was in your bank account.

    There's not really much way around this, other than simply not to give him the money.

  •  Here's a question (1+ / 0-)
    Recommended by:
    zmom

    Your nephew is buying a home, right?

    And everything went smoothly until the closing costs came in higher than expected...? Which caused you to gift him the money to cover the rest...?

    So, your nephew is in a financial position such that what is probably a few hundred extra dollars in closing costs breaks the bank for him and causes the home buying to fail?

    Your nephew can't put his hands on (say) $500 if he needs to do so? Maybe I do not understand something, but is it really a good idea for him to be buying this house?

    (-5.50,-6.67): Left Libertarian
    Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

    by Sparhawk on Fri Aug 09, 2013 at 11:25:42 PM PDT

    •  Thanks for replying; it is somewhat more than (0+ / 0-)

      $500 but less than $10,000.  I understand your thinking but he has done his math homework and if he were to rent this home or similar, he would be paying 4-$500 more a month in rent than if he had the mortgage, and even with the higher closing costs he would be ahead in a year.  I am here to help him out, that's what family does, it is not for me to judge his financial decisions-I either want to help which means there can be no strings attached, or I don't help him.  And I will help him even if I have to cough up more info than I would like to, I was just looking for another way to make it work for all parties.

  •  We "gifted" money to our son and his wife (1+ / 0-)
    Recommended by:
    zmom

    for a down payment on a home....and, YES, their bank wanted proof that we had the money and that the money was "legally" there and it was my son's to use. So, yes, they wanted bank statements that the money was legal!!!! And that was under Bush! I guess they thought it was illegal???? Or maybe funny?

    Character is what you are in the dark. Emilio Lizardo in Buckaroo Bonzai

    by Temmoku on Sat Aug 10, 2013 at 09:26:08 AM PDT

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