Mortgage company requesting plan doc

[TPApril]

Is this new - mortgage companies are now requiring plan documents to help secure a residential mortgage loan that has nothing to do with the 401(k) plan itself?

Initially tpa just provided the section on distributions because they wanted to know the availability of funds but they have come back to request the document in full.

[Bird]

I've had them ask for account balance statements, but never the plan. Someone is probably misreading a checklist.

[jpod]

Could it be that this is done if the borrower is an older person who declares his or her pension money as a major source of income? How old is the borrower?

[hr for me]

Is the participant taking any kind of distribution to help fund the mortgage? I remember years ago (like 20) I had to prove where a larger sum of money came from (hardship distribution) because underwriters don't like unknown sums of money just showing up. But all I had to do was provide the distribution paperwork, not a plan document!

[TPApril]

Borrower is 50 not taking any loan or distribution from the plan .

[RatherBeGolfing]

I have had the same requests but I always just provide the SPD and they are fine with that.

[K2retire]

I've often provided SPDs as well.

I once asked a mortgage company person why they were requesting information about plan assets when they could not be used to secure the loan and no withdrawal was being used to pay for the down payment. That person responded that they use the existence of a significant plan balance to help determine the financial responsibility of the borrower when setting the interest rate for the mortgage.