Documents Required for a Home Loan Application
There are mainly ten documents required for a Mortgage Application:
(1) Your Personal Identification
A Valid form of Identification will be required by the Lender to assure that it is you applying for the Loan and not someone else pretending to be you. The Lender would want to assure that they are lending to the right person. The document must be a valid government issued identification card that bears your photograph. Acceptable form of Identification includes a State Divers License or Identity Card, A Passport or an Alien Registration card.
(2) Social Security Card
In addition to providing your Social Security number to the lender for a credit check, A Lender may request a copy of your Social Security card to match it with your Identification to further authenticate your Identity.
(3) Pay Stubs
To verify your Income and your Employer, a most recent pay stub will be required by the lender. You have to provide the actual pay stub and a copy of the pay stub would be forwarded to the lender. If you are paid electronically, you can request your employer to provide a copy of your pay stub or can request it from your bank.
(4) Bank Statement:
Bank Statement is required to assure you can afford the down payment on the house. Bank Statements also verify a financial pattern for any bounced checks, Insufficient funds, Deposits and any large recent deposits. The Lender will also ask you for account numbers of your other checking and savings accounts you used in the last 2-3 months.
(5) Tax Documents:
Your two most recent W2 forms may be required to verify your Income from your current and past employers. If you are missing a Tax transcript, you can Request the IRS for a Tax transcript or Contact a Tax Professional to provide you a copy or to assist you.
(6) Investment Account Statements:
Lenders want to see your combined Income and assets since not everyone keep all their savings in a savings account, and your job may not be your only source of Income. Investment Accounts include Mutual Funds, Stocks, Bonds, 401(k) and 403(b) accounts.
(7) Monthly Payable Debts:
Lender would like to see a list of your monthly payments you make on your debts to analyze if you are able to take on more debt based upon your Income, to determine Debt to Income Ratio (DTI). The list of debt may include your car payment, credit cards, personal loans, student loans, medical bills, Mortgage or rent, home association dues etc. Variable expenses such as groceries, utilities, entertainment and transportation is not included in the Debt to Income Ratio (DTI). The list of payable debts should include the creditors name, total debt and the monthly payment.
(8) Landlord References
The Lender will require your Rental History from the landlords you have had in the past to assure you have made timely payments for rent. Depending upon the Lender, you will be required to provide the information for the time frame as requested starting from the most recent Landlord. You will be required to provide the contact information for the Landlord.
(9) Gift Letters:
If money if gifted to you, Lender will want to verify that the money used for the down payment is a gift and not a personal loan since that would add to the Debt to Income Ratio (DTI). Therefore a gift letter would be required from the loved one. A gift letter would include the donor's name, relationship, their contact information, the recipients name and contact information, gift amount and the date gift was or will be received, how the recipient will use the money, confirmation that the gift would not be repaid and signature of the recipient and the donor.
(10) Your Credit Report:
Credit Report is pulled by the lender and is the only piece of information that you would not provide the Lender but would provide them your consent and authorization. The credit report will provide the lender your pattern of timely payments, your debts, any bankruptcies, Liens or Judgements if any. It is always a good idea to review your credit report in advance and to check your (FICO) Credit Score.
Related Topics: Uniform Residential Loan Application What is a Credit Check What is a Credit Score What is an Appraisal Documents to be signed at closing Uniform Residential Loan Application What are the Duties a loan processor may/may not perform? What is a mortgage underwriter and its Job Description? What is a Mortgage Loan Originator (MLO) and its Job decsiption What is a mortgage lender/funder ? The Loan Estimate (LE) The Closing Disclsoure (CD) Grants & Assistance Programs The Loan Estimate (LE) The Closing Disclsoure (CD) What is “Notice of right to rescind” ? What is "Cash out refinance"? Promissory Note A Mortgage or Security Instrument What is Debt to Income Ratio and how is DTI calculated What are Jumbo Loans? Conventional Loans FHA Loans VA Loans USDA Loans An Adjustable Rate Mortgage A Fixed Rate Mortgage Construction Loans Graduated Payment Loans
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