Required Documents For Mortgage

The first thing you need to do when you plan to purchase a home is to find a lender that will provide you with the financing you need. This is to establish your identity and your ability to pay the loan. A broker or an underwriter will verify the information provided. However, if there are problems with the verification process, the borrower will be asked to submit more documents.

It is important that you know the different documents necessary for mortgage so that you will be able to prepare them ahead of time. Most lenders would require documents from three months or from three years ago in order to verify information.

To help you prepare the necessary documents, below are some of the documents needed for mortgage:

1. Most lenders will require of paystubs for the last three months. If you have a business or works on a commission basis, additional documents will be required. They may request for a statement of gains and losses over the past year.

2. Your tax return for the last 2 years will also be required. This should include all schedules. If you are paid through commission basis for a sales business, then prepare your tax returns for the last three including all schedules.

3. If employed, your employment status has to be verified. The lender will have your employer sign a form to prove this. Your salary as well as his length of service shall be indicated in the form. Other information regarding the status of the borrower as well as any expected raise may also be identified.

4. If you are currently renting, landlord verification is essential. You will be asked to provide the name and the address of your landlord as well as his contact details. A copy of the lease may also be requested. There are also instances when the landlord will be asked to fill up a form.

5. If you are planning to sell your current home, you will be asked to submit a copy of the listing agreement with your real estate agent or the copy of the Agreement of Sale or Purchase. If you have sold the property already, you will be asked to submit a copy of the closing statement or the HUD1. A copy of the proceed check may also be required.

6. Lenders will also require you of a homeowner's insurance coverage. You have to show a proof of payment for the coverage of the first year. Most lenders will not approve your loan without this.

7. If you are applying for a loan to refinance an existing loan, the lender may require you to submit a copy of the note or the current mortgage. You can acquire this easily since this is a public record. You may encounter problems if the mortgage has not been filed but you can always contact your previous lender.

Before you apply for mortgage, see to it that you are familiar with the documents they require. If you have all the necessary documents, the next steps will be easier. The processing will be faster as well.

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