Where to stash down payment

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Hi,

I've recently relocated from VA to WA.  I'm currently under contract to sell my house in VA and will be buying a new home in WA 8-10 months from now.   I'll be pocketing some profit in addition to the original down payment which will be needed to purchase the new home.  Any recommendations on where to temporarily stash the proceeds?  I was thinking of investing in a REIT or some other liquid real-estate type investment so that my down payment tracks with the housing market.  Any other recommendations?

Thanks!

 - Kevin

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How much $?

Your time horizon is very short. Given that you'll need to be deploying that capital relatively quickly, why not stash it in a high-yield savings account that's yielding ~1%?

The correlation of reits isn't high and stable enough to be an effective tracker of a certain towns residential properties. I'd just keep it simple and put it in a savings/money market account. There is a thread here devoted to the best current deals.

You might also consider doing a brokerage account signup bonus with the funds, depending on your timeframe for using the money, many require you to keep it there a certain period or they will clawback the bonus.

KWolfe81 said:   and will be buying a new home in WA 8-10 months from nowstash it to create a paper trail

if you are using for down payment, you will have to show the bank where they came from if you don't have 2 months worth of seasoned funds

rufflesinc said:   if you are using for down payment, you will have to show the bank where they came from if you don't have 2 months worth of seasoned funds
  Which shouldn't necessarily be a problem.  I transferred my down payment from my brokerage account (margin) 3 days before closing.  I just needed to provide screenshots of the accounts showing the withdrawal/deposit/Cashier'sCheckWithdrawal.

Bend3r said:   
rufflesinc said:   if you are using for down payment, you will have to show the bank where they came from if you don't have 2 months worth of seasoned funds
  Which shouldn't necessarily be a problem.  I transferred my down payment from my brokerage account (margin) 3 days before closing.  I just needed to provide screenshots of the accounts showing the withdrawal/deposit/Cashier'sCheckWithdrawal.

  Just letting the OP know ... banks are anal .... not to do anything that requires putting the money in cash.

I have some room under my bed and will help you stash the cash.

I would be tempted to do Bank App-o-rama sign up bonuses similar to credit card App-o-rama. Money would be in insured institutions and safe. Many of these banks do not pull credit, so FICO should have minimum impact. IF they ask later, explain the move as motivation to do what you do.  You are looking at different banking options looking for a new bank your money can call home.
Otherwise, some high grade investment very short term deposit items are best.

http://www.doctorofcredit.com/best-bank-account-bonuses/ 

https://www.fatwallet.com/forums/finance/682884

JW10 said:   I would be tempted to do Bank App-o-rama similar to credit card App-o-rama. Money would be in insured institutions and safe. Many of these banks do not pull credit, so FICO should have minimum impact.
  That sounds like a more annoying thing to resolve for underwriting. You'd have to report all those extra accounts (normally you only show accounts funds come from), plus then you would have to follow up tracing withdrawals from all the accounts and also sound like a madman when "explaining" the reason.

Depends on how many OP does. With that kind of money, he can choose the most lucrative few. Not every offer that pops up on this screen.
When OP gets ready to seriously shop, he just consolidates.  I made that suggestion on the concept that the money would be loose for 6 to 10 month thereby missing the typical year CD, etc.

rufflesinc said:   
Bend3r said:   
rufflesinc said:   if you are using for down payment, you will have to show the bank where they came from if you don't have 2 months worth of seasoned funds
  Which shouldn't necessarily be a problem.  I transferred my down payment from my brokerage account (margin) 3 days before closing.  I just needed to provide screenshots of the accounts showing the withdrawal/deposit/Cashier'sCheckWithdrawal.

  Just letting the OP know ... banks are anal .... not to do anything that requires putting the money in cash.

  The banks aren't going to deviate from general underwriting standards that require documentation that funds were seasoned.  If the bank later decides to sell your loan to a government sponsored enterprise such as Freddie Mac or Fannie Mae, the bank risks having to buy your loan back from Freddie/Fannie/etc if they have not properly documented your source of funds.

KWolfe81 said:   and will be buying a new home in WA

  Why are you buying ​new​?  There's a significant premium for new construction.

JW10 said:   I would be tempted to do Bank App-o-rama sign up bonuses similar to credit card App-o-rama. Money would be in insured institutions and safe. Many of these banks do not pull credit, so FICO should have minimum impact.
 

It's a quibble, I know, but opening bank accounts for signing bonuses isn't an app-o-rama at all.  The whole point of the app-o-rama is to apply for credit with multiple lenders at the same time so that any derogatory impact of the credit inquiries and resulting new lines, age of accounts, etc., isn't impacting the other applications that you are submitting.  As you said, opening a bank account doesn't generally require a credit inquiry, so it doesn't matter if I open one account per week for six weeks or open all six accounts on one day.  There's no "app-o-rama" necessary.

Secondly, it doesn't generally take a large sum of money to qualify for a new account bonus.  It isn't really a relevant response to a "where do I put all this money" inquiry.

ksea said:   KWolfe81 said:   and will be buying a new home in WA

  Why are you buying ​new​?  There's a significant premium for new construction.

New to op!

dcwilbur said:   
JW10 said:   I would be tempted to do Bank App-o-rama sign up bonuses similar to credit card App-o-rama. Money would be in insured institutions and safe. Many of these banks do not pull credit, so FICO should have minimum impact.
Secondly, it doesn't generally take a large sum of money to qualify for a new account bonus.  It isn't really a relevant response to a "where do I put all this money" inquiry.

  True. You could do brokerages instead. There are pretty good miles and cash deals for dumping 100k in Fidelity or wherever for 9 months. Then put it in a stable value fund of some sort.



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