What documentation do I need to apply for a home mortgage loan?

Learn what documents you will need during the mortgage process and in underwriting.

When you first apply for a home loan, the lender will ask you many questions about your financial and credit situation either in person, over the phone or by e-mail. The questions they will ask you will pertain to your current employment, credit, finances, down payment and your real estate goals. This is often called a mortgage application and the technical term for this application in the lending business is a 1003.

If all goes well during the application process and the loan officer has determined that your pre-qualified for a new mortgage after they have ran the numbers and pulled your credit report, you will then begin the mortgage underwriting process. This is required for a full Pre-Approval, if you do not go through the physical underwriting process you only have a “Conditional Approval or Pre-Qualification”.

This process can take anywhere from as little as a week to as much as 30 to 60 days. During this time frame your lender will process your home loan and underwrite your file by verifying and triple checking everything that you have verbally told them. The lender will employ a loan processor, mortgage underwriter and in some cases a processing assistant who will work with a loan officer to get the required paperwork from you and the other parties involved in order to close your loan

Let me warn you that there is often a lot of documentation required when applying for a home mortgage. 

The lender must be able to provide information to the bank and or investors to prove that you are eligible and financially stable to receive the home loan and pay the monthly mortgage payments long term that are required as part of your contract that will often last 30 years.

Below is an extensive list of the documentation you will need during the mortgage process.

NOTE: Please also keep in mind that there are portfolio mortgages available if you do not qualify for a traditional mortgage. A few examples of those are low down payment loans or down payment assistance, credit scores as low as 580 (620 ideally), 10% down jumbo loans call me at 1-800-779-7547 and we can discuss your options privately.

W-2’s

One of the most important documents required is your W-2 from the last two years. You should have enough income to cover the mortgage and some if you are going to qualify. The amount of money earned on your W-2 is what is used to base the value you will qualify for when shopping for a home mortgage.

Self-employed borrowers will have to show at least a year’s worth of income through the tax returns and a year to date profit and loss. It is much harder to obtain a loan now, due to the housing boom and improper lending that caused the market to crash and for thousands of foreclosures.

Verified income

Most lenders will require 2-3 months of previous pay stubs to verify that you have current and regular income. This ensures that you still have a job and are obtaining a proper income to cover the loan that is being requested.

Tax returns

You also must provide the last two years of your tax returns. The lender will analyze your taxes and ensure that all the numbers and income numbers match up. They will also ensure you are current on all back taxes prior to getting involved in another loan.

Debts

There will also be a list of debts required for the lender. The lender needs to know how extended you are in other areas. They will incorporate car loans and credit card debt into their debt-to-income ratio. This ratio determines how much you will be loaned.

Bank statements

The lender will also want to see the last couple of months of bank statements. They want to verify that you have been consistently saving your down payment and closing cost money. They will also notice if you have been gifted a certain amount to help with the down payment and they will question if you are able to weather the storms that may come if you are relying on a gift to purchase your home. They will also want to know if your gift is actually a loan that you are not disclosing.

Credit report

There will be a credit report check at the beginning of your pre-qualification step and at the end prior to closing on the home to ensure nothing significant has changed. Make sure that your credit report is up-to-date and accurate prior to applying for a loan.

Miscellaneous documents

Besides these major documents, you may need other specialized documents depending on your loan.
If you received a gift, it may need to be documented that it is not a loan by the gift-giver. This usually requires a copy of the bank statement from the gift-giver and a letter declaring that the gift is not a loan.

* If you are applying for a VA loan, you will need a copy of a DD-214, showing prior military service. If you are divorced, you may need a copy of your birth certificate.

* If you are recently married, you will need a copy of your marriage license.

* If you filed for bankruptcy in the past, a bankruptcy dismissal form may be required.
They also like to have copies of your driver’s license and social security card for identification purposes.

Some or all of these documents may be required for you to obtain your home mortgage loan. There are many forms to fill out and that is why it is important to work with a great lender and real estate agent that can keep you pointed in the right direction and most of all, close your loan with as little hassles as possible.

If you have questions about this process, you can visit this discussion link in our forum.

Article by Erik Sandstrom

Article by Erik Sandstrom

Manager and Loan Officer at Caliber Home Loans

If you need help with a mortgage question, or you are looking for a great home loan, please call me direct today at 619-379-8999 or email Erik.Sandstrom@CaliberHomeLoans.com.