Selling Guide

Published April 07, 2021

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What is required when assets are validated through DU validation service?

Asset Validation

The following table lists the asset types that can be validated and the documentation that DU will require, which may be different than the standard documentation required in this Guide.

Eligible Asset Types Eligible Verification Report

Total funds to be verified as required by DU, based on assets held in the following  accounts:                           

  • Checking
  • Savings
  • Certificates of Deposit
  • Stocks
  • Money Market
  • Mutual funds
  • Retirement

Asset Verification Report

 

Note: Additional documentation may be required depending on the type of asset account and the assessment conducted by DU for validation purposes.

Asset—Additional Information

The following additional information applies to asset validation.

  • The account statements obtained from the vendor must cover the most recent:
    • 30 days of account activity for refinance transactions
    • 60 days of account activity for purchase transactions
    • The most recent quarter, if account information is reported on a quarterly basis
  • The lender must review the verification report, and investigate and resolve any conflicting or contradictory information. The lender must also confirm that the borrower is listed as an account holder for each asset account.
  • The DU validation service automates the assessment of large deposits on purchase transactions required in B3-4.2-02, Depository Accounts. When a large deposit needs to be documented, DU will issue a message specifying the amount of the large deposit, as well as the institution name and account number of the account that includes the large deposit. If no message is issued by DU, then no documentation of any large deposit appearing on the asset report is required when assets have been validated.
  • When the DU validation service validates assets on transactions with gift funds, the lender must ensure that the gift funds that appear as deposits on the asset verification report (if any) meet the requirements in B3-4.3-04, Personal Gift Funds.
  • If the actual amount of funds required to complete the transaction is greater than the Funds Required to Close specified in DU, the lender must document liquid assets to cover the additional amount. See B3-2-10, Accuracy of DU Data, DU Tolerances, and Errors in the Credit Report for additional details on whether the loan must be resubmitted to DU.
  • For self-employed borrowers, if an eligible asset account is reflected as a business account on the verification report, the lender must perform a business cash flow analysis to confirm that the withdrawal of funds for this transaction will not have a negative impact on the business. If the lender determines the withdrawal would have a negative impact on the business, the lender must remove the assets from the online loan application, obtain an updated verification report that excludes the business account, and resubmit the loan to DU.
  • When retirement assets are entered in DU, DU issues a message requiring the lender to ensure that withdrawals are permitted, and that withdrawals are not limited to those completed in connection with the borrower’s employment termination, retirement, or death. If any of these conditions are present, the lender must remove the retirement account assets from the online loan application, obtain an updated verification report that excludes the retirement account, and resubmit the loan to DU.

 

For additional information, see B3-2-02, DU Validation Service.

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