FHA assets: money is usable only when the lender can verify what it is and where it came from.
Bank balances, earnest money, retirement accounts, investments, business assets and even cash on hand can require different documentation.
Checking and savings
The lender verifies sufficient funds and evaluates deposits according to FHA's asset-verification rules. A large or unusual deposit may need to be sourced when required; routine identifiable deposits should not be treated as mysterious simply because they appear on a bank statement.
Earnest money
Earnest money already paid can be credited toward the transaction when properly verified. FHA documentation becomes particularly important when the deposit is large relative to the borrower's profile or otherwise requires source verification.
Retirement accounts
Under FHA's manual asset rule, the lender may generally include up to 60% of the value of eligible retirement assets, less existing loans, unless conclusive evidence establishes a higher amount actually available after taxes and withdrawal penalties. Eligible unused amounts can potentially count as reserves after the required adjustment.
Stocks, bonds and investments
Investment assets can be eligible when ownership/value and liquidation or availability are documented as required. Market value and transaction timing matter when the assets are being sold for closing.
Cash on hand
FHA can permit cash held outside a financial institution, but this is not a casual “I saved cash at home” exception. The lender must document how it accumulated, the time period, and whether the explanation is reasonable considering income, spending habits, expenses and the borrower's history of using financial institutions. The funds must be deposited or held by the appropriate settlement party.
Secured loans
Borrowed funds secured by an eligible asset can be an acceptable source when FHA's requirements are met. The new debt/payment must also be treated appropriately in qualification.
Sale of personal property
Proceeds from selling personal property can be used when ownership, value, sale and receipt of funds are documented according to FHA requirements.
Business funds
A self-employed borrower may have access to business assets, but the lender must evaluate whether withdrawing those funds harms the business's ability to operate. “I own the company” is not the entire analysis.
Reserves
Reserve requirements depend on the FHA transaction and underwriting path. Manual underwriting, multifamily properties and other risk factors can make reserves especially important; reserves can also serve as a compensating factor when the Handbook definition is satisfied.
Official FHA policy baseline
Primary source: HUD/FHA Single Family Housing Policy Handbook 4000.1. HUD identifies it as the consolidated, comprehensive source of FHA Single Family policy; the current update was published August 12, 2026.