Applying For Home Loan? Here is a Checklist of Documents to Have Ready
When applying for a home loan, there are a number of different documents that are needed in order to process your mortgage application. In order to make sure that all of our clients enjoy a smooth application process, we ask that you have the following documents ready ahead of time. This will help you avoid many frustrating delays and enable us to provide you with assistance as quickly as possible. It also means that we can spend more time working with you to find your best options, as opposed to waiting while trying to figure out what is missing.
Take a look at the list below and get everything ready so that you can go through the application and processing quickly and easily. **Important: You are not required to provide these documents to us at the time of the initial pre-qualification/ pre-approval application. However, most of these documents will be needed to complete the full mortgage application.
1. Property Related Documents
- A copy of sales contract, executed by all the parties.
- A copy of deed (in case of refinanced homes).
- Location details of the property (complete address).
The lender requires these documents to examine the terms of the sale and property transfer deed and ensure that everything is in place.
2. Documents Related to Your Employment History and Income
- W-2 forms for the last two years
- Tax returns for the past two years
- Most recent paystubs (the last 30 days)
- Most recent P&L statement (for self-employed borrowers)
- Employment history for the past two years (the name and contact details of the employers).
Note: In case the borrower is unemployed for the past couple of years, they must write a note providing reasons for the gap.
Income and employment related documents are used by the lender to assess the risk of lending to the applicant. Lenders weigh these documents heavily when evaluating the borrower’s creditworthiness.
3. Documents Related to Your Personal Info
- A copy of your driving license
- Your Social Security Card
The lender uses these documents to verify identify and comply with federal regulations.
4. Documents Related to the Assets you Hold and Outstanding Liabilities
- Your housing expense
- Most recent bank statements (last two months)
- 401 K statement
- A list of assets such as stocks, bonds, and real estate holdings (if any).
- A list of outstanding debts such as medical bills, and student loans.
The lender uses these documents to calculate your debt-to-income ratio. Borrowers with a healthy debt-to-income ratio represent less risk , which enhances their chances of securing an approval.
5. Other Documents
- A copy of any divorce and/or child support order, if applicable.
- Bankruptcy papers, including discharge papers, if applicable.
- Documents showing the source of any large deposits outside your payroll.
Note: Borrowers are also advised to attach a note (along with supporting documents) detailing the circumstances that led to them declaring bankruptcy, or having a foreclosure. Borrowers having late payments must write a note explaining the reasons that forced them to fall behind their payment schedule.