For the second edition of our blog series on new challenges home buyers are facing in 2021, we’re focusing on a type of app that has been growing in popularity for several years: payment apps.
While these apps—some popular examples being Venmo, Apple Pay, and Cash App—provide convenient avenues for transferring funds, they can cause challenges and potential delays to those trying to purchase a home.
While making $50 from selling an old bike on Craigslist may feel insignificant, if a payment app was used for the transaction, a lender will likely need documentation identifying the source of the extra income. Virginia REALTORS® General Counsel Laura Farley says, “It’s important that REALTORS® explain to their clients that microtransactions from payment apps are important to lenders. The earlier in the home-buying process that your clients know this, the better, as they can begin gathering whatever specific documentation their lender requires and avoid any delays down the line.”
This issue is particularly relevant in 2021, as most of us have been spending extra time at home, organizing our space and getting rid of clutter. During the COVID-19 pandemic, the resale industry has been booming due to people purging unwanted items during this extra time at home and also due to the tightening of purse strings caused by the economic downturn.
Sure, it may have felt like a victory to your buyer when they sold that Christmas gift they didn’t care for on eBay, but it could stall their ability to purchase a home if not documented properly.
Check out ALL of our stories in the “New Challenges for Buyers” series here: