Before you can start the search for your dream home, you need to know your budget. After all,what’s the point of shopping if you don’t know what you can spend?If you’re like most home buyers, you’ll be using a mortgage to finance the purchase of your new home. Getting a mortgage isn’t complicated, but there is a fair amount of paperwork necessary to get pre-approved and start your home search off on the right foot.Here’s a list of all the things you’ll need to get the pre-approval process started.
Identification: A driver’s license or state-issued ID card works best here, but any sort of government-issued ID like a passport, military ID works too.
Last Two Years of Federal Tax Returns: Mortgage lenders are looking to establish afinancial understanding of you; tax returns demonstrate your income history and help supportyour ability to pay back your potential loan.
Last Two Years of W-2 / 1099 / K-1 Statements: These statements help corroborate the financial picture your tax returns paint and are an important verification step for mortgage underwriters.
Pay stubs Covering the Previous 30 Days: If your taxes and W-2s help the bank understand your financial past, your pay stubs help them understand the present. Generally, only one pay stub is necessary if it contains year-to-date payment information on it.
P&L Statements (if you’re a business owner): If your income depends on the operation of a business, the bank will want to support your pay stubs with profit & loss statements from any businesses you operate.
Asset Statements: In order to assess your ability to make payments on a loan, mortgage companies also want to get an idea of your current assets, including balances in checking and savings accounts, retirement/401k/IRA accounts, and any investment portfolios you have.
Copy of Current Mortgage Statement (if applicable): If you’re already the owner of a home or property and have a current mortgage on it, your lender will want to review the documentation for that loan (even if they are the lender on that property too).
Copy of your Property Tax Statements (if applicable): Like a mortgage statement, your property tax statements will help a lender determine your payment history and ability.Is something missing from this list? There is no standard document requirement for the industry;different lending institutions may require different documentation. Make sure to connect with your lender to make sure there’s nothing else they need to get you pre-approved. Information obtained here is from Theclose.com
To print out my checklist, click HERE