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Understanding Bank Statement for FHA


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A bank statement for FHA is important. When applying for a home loan, one of the things lenders will require you to submit is bank statements. This is to prove your ability to make monthly payments as well as pay for the down payment and closing fees.

Your bank statements will allow lenders to ensure that there is nothing suspicious about your financial situation. Things like large deposits from an unclear source and non-disclosed credit account making monthly payments can raise suspicions.

So, we’ve put together a guide to help you understand bank statements and why you need them for an FHA loan.

What are bank statements?

A bank statement is a financial document that sums up the activity in your bank account. Thisincludes any deposit and withdrawal that you make. Bank statements can come in electronic or paper form, depending on your bank and the type of request you make. Plus, they let you keep track of your money flow.

FHA loans in a nutshell

Just as a summary, an FHA loan is a type of mortgage supported by the Federal Housing Administration. To qualify, you need to meet certain credit score requirements and make the necessary down payment. This is a popular home loan among first-time homebuyers, and you can choose between a 15-year or 30-year term with refinance options in the future.

Some more requirements for an FHA loan is a clear employment history, verifiable income documentation, and using the purchased home as your primary residence. Furthermore, you also have to make sure that an FHA-approved appraiser appraises the property.

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Why do you need bank statements for FHA loans?

So, why do FHA lenders need your bank statements to decide whether or not to approve your application? What kind of information can they get from these statements?

The short answer is they lenders want verifiable proof that you have enough money in your account to pay for the down payment, closing costs, and monthly payments.

Using your recent bank statements is an easy and reliable way to do this.

Some of the things that lenders will look at include, but are not limited to, your account number and account type, the names listed on the account, and your saving amount. This information will be taken into consideration when determining your eligibility for the home loan.

How to get your bank statements

The majority of banks will store your statements for up to 10 years, so it should be quite easy to get just the last two months’ statements. In fact, all you need to do is access your account online and print them out on your own!

Log In

The first step to getting your bank statements is simply by logging into your account online. You can contact your bank union or customer service to get the log in details.

Find the Statements

There should be a button or tab called “Statements” on the webpage. Poke around the website until you located the correct documents.

Print Them Out

Finally, download statements for all the months that you need. This is typically two months, although some lenders may require more. The last thing to do is to print them out, and you’re all set.

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If you have more than one bank account, just repeat the steps until you have gathered everything you need. This includes any account you will use to pay the loan later on!

And if you can’t access the statements online, you can simply visit your bank and they will help you print out the physical copies.

How many bank statements do you need?

Now that you understand what lenders are looking for in your bank statements, how far back do you need to provide? Every lender may have different minimum requirements that can help them qualify you for the mortgage.

Typically, you need to submit bank statements of the last two months, which is usually enough to check your savings and examine any suspicious financial activity. The statements will also reveal any credit account you may have opened in recent months.

Of course, if you are applying for a bank statement loan, you may need to submit up to 24 months — but this is a different matter altogether.

Things to avoid in a bank statement for FHA

Once you submit your statements, underwriters will peruse them. These are some things you might want to avoid:

  • Low savings
  • Unstable income with drastic changes in recent months
  • Overdrafts
  • Large, unexplainable cash influxes into your account

Final thoughts

All in all, bank statements are monthly financial documents that track all activity done in relation to your account. These statements are necessary for FHA lenders to determine your eligibility for a home loan. We hope this article has helped you understand more about bank statements for FHA!