Documents You Need to Get a Mortgage

It’s no secret that there’s a lot of paperwork involved in buying a house. Nowadays, lenders would require paperwork that documents every facet of your financial life: assets, taxable income, residence history and a lot more.

This week, we’ll help you organize your documents so as to make sure that your mortgage application goes as smoothly as possible. While the documents a mortgage broker or a lender will require may vary, most of them would request for the following:

Proof of assets

  • Security accounts – life insurance, bonds, stocks
  • Bank account statements from the last 3 months
  • Gift letters

This shows that you have saved enough money and is capable of paying for your monthly obligations and other expenses. If you have received money from your parents or relatives to help cover the closing costs or down payment, a gift letter should be provided. The letter should state that the money you have received will not have to be repaid and is considered as a gift.

Proof of income

  • W-2 statements, pay stubs for the last 2 years
  • Tax returns
  • Proof of other income such as pension income, disability payments, social security, rental property income, alimony etc.

Lenders will take a look at your annual income and wants to approve you based on your current salary. Make sure the pay stubs are current or your lender won’t accept them.

Proof of debts

  • Current mortgages
  • Credit card accounts
  • Outstanding student loans
  • Car loans

Lenders will look at any financial commitments you have. If you have other loans, you may find it difficult to get a mortgage. If you do get qualified, the amount of money you can borrow may not be that big.

Your lender may ask for additional documents, but preparing these documents in advance will surely speed up the process. But if you want to avoid delays and ensure that the application goes as quickly and as smoothly as possible, it would be best to get pre-approved.