Seasoning funds help prevent fraud by verifying what?

• A. To verify the floor plan of the property
• B. To expedite closing by bypassing verification
• C. To increase the down payment size
• D. To validate the source and legitimacy of funds

Answer: (D)

Seasoning funds focuses on where the money for the down payment and closing costs comes from and whether it has been held in the borrower's accounts for a set period. This helps ensure the funds are legitimate and not borrowed or obtained through fraudulent means, which is a key safeguard against money laundering and misrepresentation. That’s why the correct choice is that seasoning funds are used to validate the source and legitimacy of funds. The other options don’t address fund provenance or fraud prevention: verifying a floor plan isn’t related to money sources; bypassing verification would defeat safeguards; and simply increasing the down payment size doesn’t confirm where the money came from.