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What is a Verification of Deposit?

By Bethany Keene
Updated May 16, 2024
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A verification of deposit is a document prepared by an individual's bank stating that he or she has a certain amount of funds in reserve in the bank, such as in a checking or savings account. These letters may be prepared after a potential borrower applies for a loan at another lending location, such as a loan for a vehicle or home. Mortgage lenders in particular will generally always require a verification of deposit before approving a mortgage.

The process for obtaining this verification is typically very simple, and generally just requires making a visit or phone call to the bank to request the letter. The bank may send the letter directly to the lender, but they may also be willing to provide a copy to you. The letter should be created on official letterhead belonging to the bank; the lender may also place a phone call to the bank to verify that the letter is legitimate and that the funds are there. The verification of deposit will then be kept with the loan application for future reference.

The reason a verification of deposit is often required is because it allows the lender to see that the potential borrower has the ability to put a down payment on whatever he or she happens to be purchasing, and can indicate whether he or she has the capability of making monthly payments. This, combined with a credit score and credit report, can indicate to the lender whether the borrower is a good credit risk and is likely to pay the funds back as agreed. If the lender discovers that the borrower has lied on his or her application about the amount of funds or the existence of certain accounts, it is likely that the lender will deny the loan request on the spot.

Some people also use the term "verification of deposit" to refer to a receipt given by the bank after a customer makes a deposit into an account at the bank. This is typically a paper receipt that should be retained until after the monthly statement comes in, showing that the funds are in the account and in the correct amount. Some banks also offer email verifications of deposit, and may automatically email the banking customer when a deposit is made to an account, or when a withdrawal is made as well. This can be a good way to keep track of account activity.

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Discussion Comments
By Melonlity — On Feb 12, 2015

@Soulfox -- Good suggestion and I would add that it is a lot easier for banks to lose things that it used to be because of the electronic nature of everything. That verification of deposit slip might be the only thing you have to show that you made the deposit.

That is because account numbers can get keyed in wrong, scanners can read numbers wrong and all sorts of things. Oh, and don't just glance at that slip when you get it. Make sure your account number is on there and the amount deposited is right before you leave your bank.

By Soulfox — On Feb 11, 2015

The last type of verification of deposit mentioned by the author should always be kept until you can make sure the bank actually made the deposit you wanted. I only mention that because a lot of people throw those away or lose them. I, personally, have had to use one of those to prove that I actually did make a deposit. Without such proof, the bank probably won't do much because they simply won't take you at your word.

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