The Mortgage Process can be annoying, bottom line. There is a lot of documents needed and some may seem redundant. It is important to know the process can be frustrating and to prepare yourself for it. I pride myself on making the process as easy as possible for my clients and reduce the amount of stress. But I still want to go over the documents needed for your mortgage, that may cause some frustration. Here is a list of the items I believe may cause frustration and explanation on why they are needed:
1. Complete Bank Statements- You will need to provide the Last 2mths bank statements and all the pages of the statement. Even thou you may have your money for closing in the account, you will need to provide the full statement(s). An online transaction history of the account or a print screen, will not be acceptable. This is because the underwriter wants to see that you have had your money needed for closing for the last 60 days or where it came from.
2. Large Deposits- Any large deposit you have in your bank accounts has to be documented on where it came from. You just having the money in your account is not enough. So if it was a gift from family you will need to provide a gift letter, proof they had the funds, etc. If you can not document it then the underwriter can not give you credit for it. A Large deposit is usually anything over $300-500, but honestly it depends on the underwriter.
3. Employment Verification- You provided paystubs, w2’s, tax returns and your first born and now the underwriter wants to verify your job. Yep, even after all you have given we still need to verify your employment and income with your employer. This is to confirm your income and also to document that you get over time, commission ,etc. One issue to know is that if you receive overtime income and your employer will not state that it will continue, the underwriter will not be able to give you credit for this income. And that could affect you getting approved for your loan.
4. Not opening new credit accounts- Once you are pre-approved for a loan do not open or apply for any new credit accounts. This means not getting the new washer and dryer with 0% interest, until after you close on your home. The reason why is that right before closing another credit report is pulled to see if you have opened any new accounts. So in theory the payment on your new dryer could get your loan denied. Just because your loan has been approved or you have been pre-approved does not mean you are done yet. Make NO major purchases or open any new credit accounts until after you close on your mortgage.
5. Documents- The documents you sign for your loan will include a lot of forms that seem to repeat themselves. This is very true of FHA loans, as there are regular mortgage documents and FHA documents. Hey what can I say, that is the government for you.
As you can tell there are parts of the mortgage process that can be annoying. This list is an overview of items that can be frustrating. But your mortgage may require more or less items. Don’t Let the Mortgage Process Annoy You, Be Prepared!!