Short answer
Yes, it may be questioned. A large deposit or transfer is not automatically a problem, but the lender may need a clear paper trail showing where the money came from, whose money it is and whether it creates a new debt. Many files use recent account history, often covering about 90 days, although the exact period and documents depend on the lender. Do not move money repeatedly to make the balance look cleaner. Preserve every statement, transfer confirmation and supporting document, then let your broker test the trail before closing.
The client problem behind the question
Your mortgage looks approved, but the latest bank statement now shows a large deposit, an account-to-account transfer or money that was not visible when the application started. The concern is not merely whether the money belongs to you. You need to know whether the trail is clear enough for the lender to accept the closing funds without delaying the transaction.
The phrase “large deposit” has no single mortgage-wide dollar definition. A payroll deposit that matches the employer record, a transfer between two accounts in your name, sale proceeds, a documented gift and borrowed money all tell different stories. The lender decides what is material for that application and what evidence is satisfactory.
What should be checked first?
Start with the original account where the money was held. Follow it through every transfer until it reaches the account used for closing. If it came from selling an investment, vehicle or property, keep the ownership record, sale agreement and proof of proceeds. If it came from family, establish whether it is a genuine gift or a repayable loan. If it came from credit, disclose the new obligation so the payment and debt-service effect can be tested.
A broker should separate four things: what the documents prove, what remains uncertain, what the current lender’s policy requires and what Rajiv’s professional interpretation suggests as the next responsible step. A regulator or insurer source does not replace the intended lender’s written program requirements.
A practical Ontario example
Illustration only: A buyer is closing in nine days and transfers $42,000 from a savings account into chequing. The chequing statement shows only the incoming amount, so it looks unexplained. The broker obtains the savings statements showing the money accumulated over time, the transfer confirmation and the current chequing statement. That may create a complete trail. If the $42,000 instead came from a new line of credit, the lender may recalculate qualification and closing funds.
This is not an approval, lender quote or account of an identifiable client. The result can change when even one material fact changes.
Can the existing A-lender approval still work?
For an A-lender file, the first route is to keep the existing approval intact. The broker sends the exact documents requested and explains the transfer without adding unnecessary applications. The institution may accept a simple same-name transfer, but its own anti-fraud, source-of-funds and underwriting procedures control the decision.
Where another A lender may fit
Another A lender should be considered when the verified file genuinely fits its current income, credit, property, valuation and timing policies. It is not useful to send the same unresolved problem to several institutions. The broker should identify the policy difference first, confirm the closing date can be met and limit unnecessary credit inquiries.
Where an alternative or B lender may fit
An alternative lender may use different documentation or tolerate a more complex file, but it still needs a credible source of funds and full disclosure of borrowed money. A B-lender solution should be reviewed for rate, fees, amortization, payment and the plan for returning to A lending rather than treated as permission to ignore the trail.
Where an MIC or individual private lender may fit
An MIC or individual private lender may focus more heavily on equity and the property, but legal, identity and source-of-funds questions do not disappear. If private financing is needed because the original closing is at risk, calculate the net advance, all fees, interest, payment, term and exit before proceeding.
An MIC is a professionally managed mortgage investment corporation using pooled investor capital. An individual private lender lends private capital. Their underwriting, terms and pricing can differ. Neither route should be described as an automatic approval, and both require a complete cost and exit review.
What should the client avoid doing?
- Do not hide a material change or assume it will remain undiscovered.
- Do not make repeated credit applications without a lender strategy.
- Do not move or spend closing funds until the remaining cash requirement is recalculated.
- Do not rely on a verbal approval, estimated value or unconfirmed exception.
- Do not accept a higher-cost mortgage without reviewing the net advance, payment, fees, maturity and exit.
Questions to ask before acting
- Which account first received or held the money?
- Can every movement be shown without a missing statement?
- Is any portion repayable or secured by another asset?
- Will paying a debt or moving funds reduce the cash required for closing?
- Has the lender confirmed the documents it will accept?
What can change the answer?
The answer can change with the amount and timing of the deposit; the source; whether the money is borrowed; ownership of the originating account; the number of transfers; lender and insurer requirements; the time before closing; and whether the remaining funds still cover the down payment, adjustments, land transfer tax and legal costs.
Scope note: The 90-day reference describes a common document lookback, not a universal lender rule. The exact review period and acceptable proof must be confirmed for the intended lender and program.
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Mortgage second opinion or strategy session
If the closing is approaching and the answer still depends on lender policy, request a Mortgage Second Opinion or Mortgage Strategy Session through SimplifyMortgage.ca. Bring the commitment, condition list, purchase agreement, current income and credit documents, property information and proof of closing funds. Rajiv can identify the pain point, test practical lender routes and explain the trade-offs before another application or financing decision is made. This link takes you to Rajiv’s business website.