So you have decided to purchase a home, you have been online looking and now you are ready to get down and dirty. The next thing you need to ask yourself is "What documents do I need to get a mortgage.
Purchasing a home is not an easy process that can happen in a snap of a finger. There are a lot of considerations that you have to decide upon. The very first question is, “How will you purchase a home?” Now, purchasing a home is a huge investment which will require a great deal of time, not to mention all the paperworks that it involves during the process. Many of the home buyers rely on mortgages to help them purchase a home. It doesn’t sound easy, does it? Securing a mortgage might seem like a tedious process, and if you are seriously planning to buy a home then you should be aware of how long the process would take. You should be familiar about which documents or paperworks to present to ensure that you would be eligible for the mortgage and would be given the best interest rates. Now, the question is, “What documents do you need to get a mortgage?“
We tell all of our clients that if you had the money to pay cash, then you can dictate the process. If you don't and are relying on someone to front the money for you, then you must provide all the documents that the mortgage lender requests in a timely fashion.
The documents a lender or mortgage broker may require varies from lender to lender. Normally lenders will provide you a specific list of what they would need. Banks, lenders and other financial institutions primarily consider three main areas in determining who is eligible for a mortgage such as, employment history, credit history, debt to income ratio (this is the percentage of income you make versus the expense you have going out). And as proof of these, most financial institutions will ask for a selection of the following documents in considering your request for amortgage loan.
Last two years’ of federal tax returns and/or W-2 statements
These are your past tax returns which will help verify your employments and earnings.
Most of the lenders will ask for your pay stubs usually covering the past two months. Make sure that the stub indicates your name, your social security number, your employer’s address and the year-to-date earnings. These information will let the lenders know whether you can manage your monthly mortgage dues with income.
Now, both these documents provide information and details on your financial earnings and the nature of your employment/s. Typically, a clear record of a steady employment will most likely work in your favor.
A credit report includes a list of your current creditors and the corresponding account information. For lenders, this will provide them a great deal of information on how you have dealt with your past and current loans. This supporting documents include the details of all loans such as, auto loans, credit cards and child support payments (if applicable). Make sure that minimum monthly payments and balances is indicated on the documents. Having to provide these documents will substantially show your solid credit history and will help you avoid high interest rate.
Expenses and Payments
One of the most important record that lenders would want to see is your bank statements. Normally they will most likely ask you to present up to three months of your bank statements.
Complete record of assets
These are supporting documents which should be submitted in acquiring a mortgage loan. These includes mutual funds, retirement accounts, real estate titles and stock certificates. This will not just promote your eligibility but they can also help to secure lower interest rate.
Information about the desired property
Giving the lenders a clear description or idea of which property you’re planning to buy will help them decide if there is a suitable home loan programs that will work for you.
Having given all these information is really helpful especially if you’re already in the process of buying a home. So make sure to gather all these papers before heading to your bank to guarantee a quick and smooth mortgage application process.
If you are looking to obtain a mortgage and need the assistance of 2ShortSaleGuys, we would be happy to get you in touch with a list of reputable lenders that we feel are great in getting the job done. Give us a call and we will be happy to explain in further detail the documents you will need to get a mortgage and why you need those documents.
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