Mortgage Approval Document Checklist

Ryan Jenkins

If you’ve been searching for a new home to purchase, you’ve most likely already begun the process of calculating your mortgage costs and applying for a loan.

Below you’ll find a list of documents needed to get a complete mortgage approval. It’s important to get qualified through a local mortgage broker or a bank you know and trust. Online mortgage pre-qualification should not be relied on for making an offer to purchase. Websites will give you a cursory qualification based simply on a pay stub. But, there are many additional factors that must be considered to ensure that you qualify for a mortgage. Submitting the information listed below to a reputable, preferably local, lender will ensure that you are able to complete the purchase of a home. This will also allow a loan officer who knows you by name to assure the seller’s realtor that your loan will go through. Gathering the following documents will make your application process as smooth as possible.

Proof of employment. Your mortgage lender will probably request a list of employers for the last two years (at a minimum). This document will also include each employer’s name, mailing address and phone number. They want to verify your employment because it relates to your ability to repay the loan.

Proof of income.  This can come in several forms. This will be your two most recent pay stubs or the electronic equivalent, that shows your year-to-date earnings. It’s your average annual income the lender wants to know about. The lender will also use tax records to verify your earnings.

Tax documents. This is a standard document for mortgage pre-approval. So there’s a 99% chance you will have to provide tax documentation at some point. Most lenders want to see your W-2 statements and tax returns for the last two years. Among other things, your W-2s show how much money you earned over the previous year(s).

Self-employment documents. Do you run your own business? If so, you might have to provide some additional documents during the mortgage pre-approval process. This might include balance sheets, a profit-and-loss statement, or federal tax statements for the last two years.

Bank account information. When you apply for mortgage pre-approval, the lender will want to know how much money you have in the bank. They need to ensure you have sufficient funds for your closing costs, down payment, and cash reserves (if applicable). So they will probably ask you for account statements and balances for any checking, savings, or money market accounts.

Purchase agreement. Also referred to as the real estate contract. Once you have a signed contract with the seller, you’ll need to give a copy to the lender. You won’t have this mortgage document during the pre-approval process (the “pre” parts means you haven’t found a house yet). But you’ll need to provide it for the final approval after you’ve made an offer on a house. This document shows the lender how much you’ve agreed to pay for the house. Later, they will have the property appraised to make sure it’s worth the amount you’ve agreed to pay.

Gift letters. Are your family members going to help you with your down payment? If so, you need to provide a gift letter along with your other mortgage documents. They need to make sure the money is truly a gift, and that your relatives don’t expect any form repayment.

Have additional mortgage questions? Get in touch with Grey Rock Realty today.

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