Irregular Deposits Could Ruin Your Mortgage—Learn to Fix It

Buying a home is exciting. But when you’re applying for a mortgage, your bank statements can suddenly become a big deal. Mortgage underwriters will look closely at your finances to make sure you’re ready for homeownership. One thing that often raises questions? Irregular deposits. In this article, we’ll break down exactly what irregular deposits are, why lenders care about them, and how to handle them so you can smoothly close on your new home.

What Are Irregular Deposits?

Irregular deposits are money placed into your bank account that’s out of the ordinary. Let’s say your paycheck is $2,000, and you get paid every two weeks. Those paychecks aren’t irregular—they’re steady and predictable. But if you suddenly deposit $5,000 cash or a check for $3,700, lenders will notice.

These deposits aren’t regular income, and your lender will need to know exactly where that money came from.

Why? Because lenders must make sure your down payment and closing costs are coming from acceptable sources. They want to make sure you’re not borrowing money secretly or getting funds from someone who might expect repayment. Irregular deposits must be properly documented, or they can’t be counted toward your mortgage approval.

Why Lenders Worry About Irregular Deposits

Mortgage lenders have rules to protect you and themselves. One rule is ensuring your down payment isn’t borrowed, which can add extra debt and strain your budget. If you take out a loan for a down payment, it may negatively impact your ability to qualify for a home mortgage since it increases your monthly debt responsibilities.

This is why lenders examine your recent bank statements—typically the past 60 days. They carefully check each deposit. If they spot irregular deposits, they’ll ask questions. If you can’t provide proof of where the money came from, lenders won’t include it when qualifying you for the loan.

Examples of Irregular Deposits and Documentation Needed

Not all irregular deposits cause problems, but you must document them clearly. Here are common examples of irregular deposits and exactly what documentation lenders usually require:

Cash from Selling Personal Items:

If you held a garage sale and deposited $2,000 cash, you’ll need to provide:

• • Bill of sale
  • Copy of deposit slip
  • Updated bank statement showing the deposit

Tax Refund Checks:

If your deposit came from a tax refund, lenders will require:

• • Copy of the IRS refund check or bank statement clearly showing the IRS deposit
  • Deposit slip

Money from Selling a Vehicle:

If you sold your car and deposited a $6,500 check, lenders need:

• • Copy of the check
  • Bill of sale
  • Copy of the transferred vehicle title
  • Deposit slip
  • Updated bank statement

What If You Can’t Document Irregular Deposits?

Sometimes, borrowers have cash at home (often called “mattress money”) that they can’t easily document. Maybe you’ve saved cash tips or side job earnings. In these cases, the best thing to do is deposit the money into your account and let it sit for at least 60 days. After 60 days, the money is considered “seasoned.” That means lenders no longer ask about the source because they only review your bank statements’ most recent two months.

Why 60 Days Matters

Mortgage guidelines only require lenders to look back two months. Mortgage underwriters usually ignore any deposits made before this period. This is great news for borrowers with undocumented cash. Put the cash into your bank, leave it untouched for two months, and after that, it becomes acceptable funds that won’t cause any questions from lenders.

How Irregular Deposits Affect Your Mortgage Application

Irregular deposits can affect your mortgage approval in a few ways:

• Delays: If lenders spot an irregular deposit, they’ll stop and ask questions. Documentation can take time, slowing down your loan approval process.
• Denials: Lenders may disqualify those funds if you can’t document the money properly. Without those funds, you might no longer meet down payment or closing cost requirements, and your application could be denied.
• Increased Debt Concerns: If lenders notice irregular deposits stemming from borrowed funds or newly established credit lines that aren’t disclosed, they may be concerned that this could raise your monthly payments and impact your capacity to repay your mortgage.

What to Do If You Plan to Apply for a Mortgage

If you plan to buy a home, get prepared early. Here are smart tips:

• Avoid Large Deposits: If possible, avoid making large, unexplained deposits within 60 days before applying for your loan.
• Document Everything: Keep records of any large deposits you make. Save receipts, checks, bills of sale, or any other paperwork.
• Talk to Your Lender Early: Discuss irregular deposits with your lender at the start of the mortgage process. Transparency helps avoid surprises.

Real-life Example: Mike’s Mortgage Approval

Mike wanted to buy his first home but had an irregular deposit issue. He sold his motorcycle for $7,000 in cash. Mike deposited this money into his bank account three weeks before applying for a mortgage. His lender quickly asked questions.

Luckily, Mike had the documentation ready. He provided:

• Bill of sale
• Deposit slip
• Updated bank statement

Since Mike provided clear documentation, his lender approved his loan quickly. Without those documents, Mike’s approval might have been delayed or denied.

Getting Your Mortgage Approved with Gustan Cho Associates

At Gustan Cho Associates, we understand that irregular deposits can be stressful. Our mortgage professionals guide borrowers through the entire process. Here’s how we help:

• Personal Guidance: Our experienced loan officers review your financial situation and help you document irregular deposits correctly.
• Clear Communication: We explain exactly what lenders need to see, so there are no surprises.
• Flexible Solutions: If documentation is an issue, we discuss alternative options—like seasoning funds—so your loan stays on track.

With our support, you’ll confidently navigate underwriting and smoothly reach your closing date.

Recent Updates to Mortgage Guidelines (2025)

It’s important to stay current. Here’s what’s new regarding irregular deposits and mortgages:

• Enhanced Digital Verification: To speed up verification, more lenders now accept digital proofs, such as electronic receipts or bank-generated online statements.
• Updated Rules on Gift Funds: Recent changes make it easier to use gift money from family members as a down payment or closing cost assistance.

At Gustan Cho Associates, we keep you informed about guideline changes that could impact your loan.

Take the Next Step

Now you know exactly why irregular deposits matter and how to handle them. Don’t let the fear of underwriting stop you from buying your dream home. With the right documentation—and a team like Gustan Cho Associates on your side—you can easily overcome irregular deposits and secure your mortgage.

Ready to apply or have questions? Borrowers who need a five-star national mortgage company licensed in 48 states with no overlays and who are experts on irregular deposits, please contact Gustan Cho Associates at 800-900-8569, text us for a faster response, or email gcho@gustancho.com.

Related> The purpose for mortgage underwriting analysis

Related> Bank statements

Related> Bank statements in the mortgage approval process

Frequently Asked Questions About Irregular Deposits:

Q: What are Irregular Deposits?

A: Irregular deposits are money put into your bank account that’s not part of your usual income, like a big cash deposit or unexpected check.

Q: Why do Lenders Care About Irregular Deposits?

A: Lenders pay close attention to irregular deposits. They need to ensure that your down payment does not come from borrowed funds, as this could impact your capacity to repay the mortgage.

Q: How Can Irregular Deposits Delay My Mortgage Approval?

A: If lenders notice irregular deposits, they’ll ask you for documents explaining where the money came from. Gathering those documents can slow down your mortgage approval.

Q: What Kind of Documents do I Need for Irregular Deposits?

A: You’ll typically need receipts, checks, bills of sale, and bank deposit slips to clearly explain any irregular deposits.

Q: What if I Can’t Explain My Irregular Deposits?

A: If you can’t clearly document irregular deposits, lenders won’t count those funds toward your down payment or closing costs, which might cause your loan application to be denied.

Q: How Long Should Irregular Deposits Sit in My Bank Before Lenders Stop Questioning Them?

A: If irregular deposits sit untouched in your bank account for 60 days, lenders usually won’t ask questions about them anymore.

Q: Can Irregular Deposits From Gift Money be Used for My Mortgage?

A: Yes, irregular deposits from gift money can be used. Still, you’ll need clear documentation, such as a gift letter and bank statements showing the deposit.

Q: Do Irregular Deposits Always Stop Me from Getting a Loan?

A: No, irregular deposits won’t always stop you. If you document them clearly and early, your lender will likely accept them without issues.

Q: Should I Avoid Irregular Deposits Right Before Applying for a Mortgage?

A: To keep the approval process smooth and quick, avoid large irregular deposits within 60 days of applying for a mortgage.

Q: Can Gustan Cho Associates Help if I have Irregular Deposits?

A: Yes! Gustan Cho Associates is an expert in dealing with irregular deposits. We’ll guide you step-by-step, keeping your mortgage approval on track.

This blog about “Irregular Deposits Could Ruin Your Mortgage—Learn to Fix It” was updated on March 24th, 2025.