10 Documents Needed Before Applying For A Home Loan
When applying for a home loan, legal obligations and proof of records are among many inquiries that may come into play.
It’s important to be ready for anything. Mortgage loans can still be difficult to access. And not being prepared can lengthen processing time. Speeding up the loan application process requires that you have all your paperwork in order early. Following are the 10 home loan documents you’ll need.
1. Bank Statements
Virtually every loan you apply will require bank statements. The are among the top 10 home loan documents. This is especially true if you are self-employed. In that case, you will need to give out at least two if not three months of statements for all accounts. Be keen on large deposits, and non-sufficient fund charges as these will tend to attract more attention.
2. Identification
Document verification is a process that must be undertaken. Unless you have got a valid ID, you will not be able to seal the deal. Your identification should also be fresh and not close to expiry.
3. W2s
If you are under someone’s employment, be ready to provide copies of your previous 2 years’ W2s.
4. Tax Returns
These are one of the trickiest documents when it comes to underwriting a mortgage. At least two years returns will be necessary. You should have all the pages including any amendments, not forgetting the originals. The documents should be put in order well before you apply for the loan.
5. Court Documents
If you’ve filed for bankruptcy or going through a divorce, ensure that you have all copies of the relevant documents to make it easy going through the loan application.
6. LOEs
In the event that you are having credit bruises or gaps in employment, letters of explanation (LOEs) will be needed and your loan officer can provide assistance in such a situation.
7. Current Mortgage Statements
Having mortgage loans in the home? Then you must verify the debt, its status of payment and other loan details. If you’re renting, then please give out your landlord’s contacts as well as proof of rental payments for the last 24 months.
8. Purchase Contract
When buying a home, you won’t make much progress without a signed purchase and sales agreement. Be sure to include copies of all pages and addendum.
9. Earnest Money Deposits
Any deposits made need to be documented fully. This includes copies of checks and receipts by the escrow holder.
10. Pay Stubs or P&Ls
Be prepared to submit your most recent pay stubs for the last month. If you are self-employed, have ready a year-to-date Profit and Loss statement.
Summary
Prepare these home loan documents and get them together early. Save all the hard copies and cloud backups, in case more evidence is required.