Using Stock Funds for Down Payment

Many times, one will wait until the last minute (right before closing) to cash in stock options for closing funds.  This can be dangerous.  If for some reason the stock crashes between the time your offer is accepted and the planned date to sell the shares, you might be out of luck for a down payment.  Keep this in mind, it might be a better idea to just bite the bullet, cash them in and have the funds available before you write an offer.  As with gift funds, if the money is not in your account and liquid at the time your offer is presented, you are required to disclose to the seller that the down payment is coming from the sale of stock.  In a competitive market, this will make your offer less attractive so it is best to have the funds available at the time you present the offer.

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