When you apply for a mortgage, the lender reads your recent bank statements, usually the last two months, to see where your down payment and closing costs come from. Any deposit that is not your regular pay can bring a question: where did this money come from? The answer goes in a letter of explanation.
What counts as a large deposit
For a conventional loan sold to Fannie Mae, a large deposit is a single deposit of more than 50% of your total monthly qualifying income. If your qualifying income is $8,000 a month, any one deposit over $4,000 is a large deposit, and the lender must look at it. Fannie Mae's Selling Guide has the rule.
FHA, VA and other loans have their own rules, and lenders can be stricter than the guide. Ask your loan officer which rule applies to you.
Find every large deposit in your statements
Send the lender the PDFs your bank gives you, exactly as they are. The spreadsheet is for you, to find the questions before the underwriter asks them.
- Download the statements the lender asked for, from every account you will use, as PDFs.
- Drop the first PDF in on our home page, and we show you its first page converted before you sign up. Sign up with your email address to download it. You do not need a card, and the free trial converts up to 5 pages of a statement, 15 pages in all, often enough for two months of one account.
- Download the Xero / QuickBooks file, with (US dates) beside it for month-first dates. It has one row for each transaction and one signed amount, money in positive. You get this file on the free trial and on the Standard and Plus plans. On Lite, the Excel file has the same transactions, with the money columns as the statement prints them.
- Paste the files into one sheet in Excel, under one header row.
| Date | Description | Amount |
|---|---|---|
| 08/01/2026 | ACH CREDIT EMPLOYER INC PAYROLL PPD | 3100.00 |
| 08/07/2026 | Zelle payment from A FAMILY MEMBER | 6000.00 |
| 08/12/2026 | MOBILE DEPOSIT | 450.00 |
| 08/15/2026 | ACH CREDIT EMPLOYER INC PAYROLL PPD | 3100.00 |
The rows above are an example, not a real statement.
Then, on the Amount column, choose Number Filters > Greater Than, and enter half of your monthly qualifying income. Every row that is left needs an answer. In the example, with $8,000 a month, that is the $6,000 Zelle payment.
Some US statements list deposits, withdrawals and checks in separate sections, with no running balance. We cannot convert those yet, and you see that on the first page, before you sign up.
Look at the smaller deposits too
A lender can ask about any deposit that is not easy to explain, not only the large ones:
- Cash deposits. Cash has no paper trail, so it is hard to source.
- Transfers from another account. The lender can ask for that account's statement too, to see where the money came from.
- Many small deposits that add up. A series of deposits from the same person can look like one large deposit.
What the letter of explanation says
A letter of explanation is short. For each deposit, give:
- The date and the amount, as the statement shows them.
- Where the money came from, in one sentence: "a gift from my mother", "the sale of my car", "a transfer from my savings account".
- The paper that proves it, attached: a gift letter, a bill of sale, or the other account's statement.
Sign and date it. Your loan officer can tell you if the lender has a form of its own.
Check the conversion
Your Excel download has a Ledger column that checks each balance against
the row before it. Filter it for break, and compare those rows with the PDF,
so that a misread figure does not send you looking for a deposit that did not
happen.
What this does not do
A spreadsheet does not tell you what a lender will accept. What it gives you is every deposit in one list, so that each question has its answer and its paper before you apply.