According to a financial survey from American Express, 53% of people say they keep at least some of their money in a secret location and not in a bank, writes MarketWatch’s personal finance reporter Daniel Goldstein.
While keeping money outside a bank may give some people peace of mind, it may come back to haunt them when they look to close on a home. Lack of verification of income or assets is one of the biggest reasons contracts fall through, said Scott Alexander, operations manager for Assurance Financial, a Baton Rouge, La.,-based lender.
Only a cashier’s check from a bank will work. “Cash on hand is unacceptable nowadays. No title company is going to accept (physical) cash as funds at the close,” Alexander said. Even if the money has been stuffed under a mattress, “the mortgage company is going to have big doubts about where that money came from,” he said, and will treat it as if it was gained illegally.