Bridget's Blog

head_left_image

Financially Naked- Documents Needed For A Mortgage

Financially Naked- Documents Needed For A Mortgage

 

What Documents Do I Need For A Mortgage Approval?

 

To determine if you qualify for a loan lenders require a lot of documentation. The day of the "NO DOC" loan is gone. These days, most lenders require you to get what a client once called "financially naked".

Don't shoot the messenger, believe me, if it wasn't required, loan officers wouldn't ask for it!

 

One of the first things that will be done for a mortgage review is a credit review.  This will help to determine your total amount of debt in addition to your credit score.  It will also show judgments, collections or tax liens, if any.  A consumer score from companies like Credit Karma is different than a mortgage score.  Different algorithms are used, often the consumer score is much higher than the mortgage score, so it is important to review your credit with a qualified loan officer.    Once they have an idea of where you stand credit wise, most lenders will require at least 2 years and sometimes 3 years of income documentation for all parties on the loan.  If using grant funds or other down payment assistance, anyone over 18 living in the home may be required to provide income proof.

 

Be prepared to provide what is requested...a lender's goal is to ensure that you can afford the property at the time of purchase and that you will be able to sustain the payments for the long term.  It is important to be aware that sometimes documentation provided means that additional supporting documentation will be needed.

 

INCOME-

  • Pay stubs or LES (if military or government)-2 most recent documenting at least 30 days of income
  • Social Security Award Letter-if receiving
  • Retirement/ Annuity (Proof received) -
  • Employment contract  (if new in position or will be getting a new job or raise)
  • W2’s/1099’s
  • Tax Returns-Federal only with all schedules -personal and business
  • Child support/Alimony if received regularly and will be used for qualifying

 

ASSETS- ALL PAGES are required, even if the page has no personal information regarding the account. If it says page x of y, the lender will require all y pages!

  • Checking Accounts -Statements, not screen prints-NO Overdrafts 
  • Savings Accounts -Statements, not screen prints 
  • 401k-2 most recent monthly or 1 most recent quarterly statement-
  • Thrift Savings Plan
  • “Mattress Money”-some programs allow funds that have not been deposited
  • Gifts-Require a Gift letter and trail of funds (showing the money coming out of the donor's account and into buyer's account).  Discuss with your lender PRIOR to moving any money.  ALL funds should be very easy to follow-(e.g.  If the gift if for $1000, do not deposit it with a $50 check from birthday, make the deposit separate)
  • Down Payment Assistance-Discuss options with your lender, there may be additional documentation required
  • Copy of Earnest Money Deposit Check

 

IDENTIFICATION:

  • Lenders will verify your identity with a copy of your driver's license (front only) or other photo id (State Identification).
  • If a permanant resident alien or Foreign National-Additional documentation is needed.  
  • EAD (Employment Authorization) card -if relevant

OTHER:   Additional documentation relevant to document qualifying or clarifying any of the above.

  • Divorce decrees or Child support agreements may be required in certain circumstances.
  • Bankruptcy, Foreclosure, Short Sale, Loan Modification Documents
  • Information on other properties owned including insurance, taxes, homeowner's association
  • Proof of payment of rent -cancelled checks

 

It is important to keep additional statements, paystubs, etc. as you go through the process, because lenders may ask for updated documents to ensure that all documentation is up to date at closing.

 

Some lenders will still provide a pre-approval without reviewing documents. In a case where your income, assets and tax returns are consistent with no surprises, you could be fine.  The best lenders will review relevant documentation PRIOR to you making an offer to catch anything that may be a concern or could cause you to get denied.   It is always best to take care of any issues BEFORE you fall in love with a home!

 

Financially Naked- Documents Needed For A Mortgage

What Documents Do I Need For A Mortgage Approval?



Warm Regards,

Bridget McGee  Maryland Mortgage Mama  NMLS# 196068  Corridor Mortgage Group.   410-960-2061 EHO   bmcgee@corridormtg.com or marylandmortgagemama@gmail.com

 

If you are considering purchasing a home in Maryland and want to be sure you are mortgage ready, my brother Tony and I will be happy to help! We help to make the mortgage process a pleasure! 

If you already own your home, we are happy to provide a no-cost mortgage review to help you to determine if refinancing may be in your best interest.  Please contact me at 410-960-2061.

Comment balloon 3 commentsBridget "Mortgage Mama" McGee • January 31 2017 03:20AM

Comments

I tell my clients to be ready to give personal information time and time again

Posted by William Feela, Realtor, Whispering Pines Realty 651-674-5999 No. (WHISPERING PINES REALTY) over 1 year ago

Bridget, thank you for the inclusive list. Next time a client would ask me why so many documents? I will show them this post. Have a good and productive week.

Posted by Shahar Hillel, Mortgage Consultant, Loan Officer. (Augusta Financial Inc.) over 1 year ago

Thank you for the detailed list Bridget! Reblogging and sharing!

"Financially naked", isn't that the truth!

Posted by Andrea Bedard, M.A.; REALTOR® Silver Spring, MD and beyond (Thompson Company, REALTORS®) over 1 year ago

Participate