An underwriter is reviewing a loan file and notices a large deposit in the borrower's bank account that occurred two weeks before application. What should the underwriter do?
Correct Answer
B) Request documentation to source the deposit
Large or unusual deposits must be sourced and documented to ensure they represent legitimate funds and not borrowed money that would increase the borrower's debt obligations. This is a standard underwriting practice to verify the borrower's true financial position and prevent fraud.
Why This Is the Correct Answer
Large or unusual deposits must be sourced and documented to ensure they represent legitimate funds and not borrowed money that would increase the borrower's debt obligations. This is a standard underwriting practice to verify the borrower's true financial position and prevent fraud.
More Mortgage Knowledge Questions
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