Buying a Maryland Home in 2025-Docs Needed

When you're getting ready to buy your first home, one of the first steps is getting pre-approved for a mortgage. This means a lender looks at your financial picture to decide how much money we can lend you. To do this, you'll need to gather several important documents. One of my clients said that it is like getting financially naked.  It is best to review your whole story with the loan officer so they can help you to best tell and document that story for your approval. Deep breaths, it looks worse than it really is! 

1. Personal Identification

Lenders need to know who you are. You'll need to provide a government-issued photo ID, like a driver's license or passport. This helps to confirm your identity.

If you are not an American citizen, additional documentation will be required to include the front and back of the permanant resident alien, EAD card or visa information. Your lender will help you to determine what is needed.

2. Social Security Number

Your Social Security number is essential for the lender to check your credit history. 

3. Proof of Income

Lenders want to see that you have a steady and reliable income to pay back the loan. You'll need to provide:

• Recent Pay Stubs: These show your current earnings.  Usually your most recent 2 paystubs will suffice, but if you have hours that vary by week, overtime, bonuses or any unusual circumstances, a verification of employment or additional paystubs may be needed.

• Pension or Social Security Award Letter, if applicable
• W-2 Forms: These forms summarize your earnings from the past two years.
• 1099's if you are get social security, disability, are self-employed or a contractor

• Tax Returns: Sometimes, lenders ask for your tax returns, with all schedules, from the last two years to get a complete picture of your income.  This is most often needed if there is self-employed income or rental income.  If there are business tax returns, most lenders will need both for approval, if the business income is needed for qualifying or if needed to document that there are no additional debts.

• If you are a veteran using a VA loan you will need to provide a DD214 so that the lender can request a Certificate of Eligiblity for VA benefits.

4. Bank Statements

Your bank statements (all pages!) from the past two months show your savings and spending habits. Lenders use these to ensure you have enough money for a down payment and closing costs.  Large deposits may need additional documentation. Retirement account statements may be needed or could help your loan file, even if not using those accounts for the purchase. 

5. List of Debts and Monthly Payments-A tri-merge (Equifax, transunion and experian) mortgage credit report will be pulled by the lender and populated into your loan application.

Lenders need to understand your current financial obligations.  For an initial review, you may be able to provide a list of your monthly debts, such as:

• Credit Card Payments

• Car Loans

• Student Loans

• Other obligations

This helps us to determine how much additional housing debt you can handle.

6. Employment Verification

Your lender might contact your employer to confirm your job status and salary. Be prepared to provide your employer's contact information.

7. Rental History

If you've been renting, some lenders or programs may want to see proof of your on-time rental payments for the past year. This shows that you have a history of making regular payments.

8. Gift Letters

If a family member or friend is giving you money to help with the down payment, you'll need a gift letter. This letter states that the money is a gift, not a loan, and that you don't have to pay it back.  An official gift letter will be provided by the lender when you get closer to your purchase.

9. Divorce Decree or Child Support Documents

If you're divorced or pay/receive child support, provide these documents. They help the lender understand your financial responsibilities or additional income (if using for qualifying).

10. Bankruptcy or Foreclosure Documents

If you've experienced bankruptcy or foreclosure, these records may be needed. They give the lender insight into your financial history.

Gathering these documents might seem like a lot of work, but having them ready will make the pre-approval process smoother and faster. Depending on your situation or loan type, you may not need most of these documents for your approval, OR you may need more! Please understand that your loan officer/processor wants to help to prepare your loan file for a smooth process through underwriting.  Sometimes documentation provided opens up more questions that we need to clarify, which could mean additional documentation to explain (or explain away) things that come up. We are telling your financial story with the documentation and want to ensure the most accurate and clear picture to get your loan approved quickly and easily!

By preparing these documents, you're taking a big step toward owning a home in Maryland!