Paperwork isn’t exactly the fun part of buying a house, but when it’s time to apply for a mortgage, you have to gather a lot of it.
Buying a home is an exciting time. However, before you head out to visit with a lender, you want to make sure you are ready.
Here is a list of what you’ll need when applying for a mortgage:
- Two forms of government identification (for each applicant).
- The past two years’ tax returns, W2s and pay stubs. If you are self-employed, you need to provide proof of income, so you’ll need a year-to-date profit and loss statement.
- Documentation, including account numbers, on all checking and savings accounts. Ask your financial institution for six months of statements on all accounts.
- If you’ve been renting from a landlord, put together a year’s worth of check copies or receipts to prove that you’ve been paying on time each month. You can also ask your landlord to write you a letter of referral.
- Documentation of all forms of regular income, such as child support, government assistance and Social Security.
- Proof of account balances for retirement accounts like your 401(k) or IRAs.
- Documentation of all stock market investments.
- Proof of ownership of any other property.
- Other pertinent personal paperwork, such as divorce papers. If you have rental income, bring the lease.
- If you’ve declared bankruptcy in the past, be prepared to disclose that information and explain in a letter what the circumstances were and how you’ve worked to resolve the situation. Be prepared to provide a copy of the discharge documents.
Make sure that you also have your down payment and closing funds deposited in the bank. This is alto the time to commit to your down payment and where it will come from. For example, some people may think they can just deposit a check from their parents. However, that requires more paperwork and has tax implications that should be taken into account.
Your finances will be under a microscope, so unexplained deposits will raise red flags. If you have generous family members who are chipping in, they will have to sign “gift letters” declaring that the money was not intended to be a loan. Some lenders require these letters to be notarized, and the whole situation can really slow down your loan process.
Being ready before you sit down to make your application will make the process go much more smoothly for you.
Check out all of our posts in our home buying and selling series!
The blog and its opinions are expressly that of its author and does not convey the opinions or strategies of the Credit Union and should not be considered financial advice. CommunityAmerica’s Mortgage offers are subject to credit approval and terms may vary based on conditions.