I live in a world of acronyms.
Seriously – when we start in the business, they should have a mortgage class related to just understanding all of the acronyms. Even worse, mortgage professionals use these acronyms in conversation with clients. I feel horrible for those individuals because it’s like we’re speaking a different language, right?
With that said, I’m going to start explaining some of the frequently used acronyms. Hopefully if you’re working with a mortgage professional, you’ll never hear these. However, every so often (too often in my opinion) you’ll hear lenders use these terms and leave you extremely confused. I don’t like being confused and I absolutely hate confusing clients.
So, What is a VOD?
VOD stands for Verification of Deposit. Still confused? A verification of deposit is a document from a bank that shows you have a certain amount of money in your bank account. It is one piece to the stack of documentation a lender pulls together when approving you for a loan.
Why would a lender use a verification of deposit?
- It can be a substitute to bank statements.
- It doesn’t show each individual transaction on the account.
- Less paper. (Be green!)
- It provides a photographic shot of any given time.
- It also identifies any outstanding loans with that financial institution.
There are advantages of using a verification of deposit. There are also disadvantages of using them. This post is intended for you to understand what a VOD is, not when to use it. If you’re working with a seasoned mortgage professional, you will never have to worry about it.
So, no more mystery mortgage talk. Now you know what a VOD is!
