Mortgage Seasoning?

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We know barbecue season is coming, but today we aren’t talking about dry rub season, but mortgage seasoning. If you’re in the market for a new home, you’ve probably heard about the best times to buy based on market trends. However, there’s another important timing factor to consider: mortgage seasoning. This term might seem a bit technical, but it’s actually pretty straightforward. Mortgage seasoning is all about how long your money needs to be in your bank account before you use it for things like your down payment and closing costs. Lenders check this to make sure the funds aren’t just appearing overnight. They want to see that you’ve managed this money over a set period, which shows you’re ready to handle the financial commitment of buying a home.

Mortgage seasoning plays a critical role in the loan application process. If your account suddenly shows a large deposit, lenders will want to know where it came from. For example, if you’ve received money from selling stocks or a gift from relatives, you’ll need to provide documentation like a gift letter or proof of your asset sale. This requirement also comes into play if you’re looking to refinance or drop your mortgage insurance, where typically, you might need to have had your mortgage for at least six months.

Why do lenders insist on seasoning? It’s a safety measure to ensure borrowers are financially stable and not just patching up their bank accounts to look good on paper. Most lenders will ask that your funds be ‘seasoned’—sitting in your account—for anywhere from 60 to 90 days before applying for a mortgage. This approach helps them confirm the money is truly yours and wasn’t borrowed temporarily to inflate your financial standing.

For those planning to buy a home, it’s wise to start seasoning your funds early. Shift your money to a savings or money market account as you begin the mortgage preapproval process. Keeping your financial profile steady—avoiding large purchases or additional loans—during this period will make you look more reliable to lenders. By the time you’re ready to make an offer, your funds will be fully seasoned, allowing the lender to process your mortgage smoothly. Of course if mortgage seasoning might apply to you schedule a consultation on our website and we can help you along the way.