When purchasing a house, getting all the paperwork ready for the mortgage is half the work. While no one is looking forward to gathering documents, doing it early (before you even start your application) will help speed up the process.
Your mortgage lender will require several documents upon your application and during the underwriting to prove that you can repay your loan. A mortgage application usually needs a paper trail for the verification of your assets, debts, income, and employment, credit history, identity, gift funds, rental history, and others.
In this post, Total Lending Concepts, your trusted mortgage lender in Colorado Springs, provides you a list of the most important documents that will be asked of you when you apply for a mortgage:
Mortgage Information Application
This is the first thing that you need to fulfill when you want to get a mortgage. You need to complete the uniform residential Loan Application form wherein you’ll provide your personal and financial information. The lender will use this form to see if you are eligible for a mortgage.
Income Verification
The lender will also ask for proof that you can pay back what you want to borrow. Here are some documents that you need as proof of income:
W-2 Forms – The lender will likely ask for W-2s from the last two years. You can ask your employer or the IRS for copies of these documents that you provided with your tax returns.
Income Tax Returns – You need to provide copies of your returns together with IRS form 4506-C that permits the lender to get your tax transcript.
Pay Stubs – Lenders usually request pay stubs from the past month or longer, which the employer should sign. This can be in hard copy or electronic form. If you receive commissions, bonuses, or the like, you’ll have to submit proof of these, too.
Contracts, Business License, or Proof of Insurance – These are documents independent contractors or self-employed workers can submit. Note that you might have to submit at least two years’ worth of proof if you are self-employed.
Assets and Debts
Lenders will also want to see if you have any debt that you have to pay and what your debt-to-income ratio is. You need to list all your monthly debt payments, including those for your student loan, auto loan, credit card, and others. You also need to provide documents showing your assets, like your investment accounts and bank accounts. Here are some documents you need to submit:
Bank statement
Credit card statement
Gift letter (only if using gift funds)
Additional Documents You Need to Submit
Apart from those mentioned above, you might be asked to submit these documents, too:
Divorce decree (if applicable)
Signed copy of the purchase and sale agreement
ID for non-citizens
Rental payment history
Bankruptcy or foreclosure records (if applicable)
Conclusion
As you can see, you need to submit a lot of documents for you to be approved for a mortgage. It can be overwhelming, but that’s precisely the reason why you should start gathering them early. This way, you won’t have to deal with delays later on. If you want to ensure that you have all the documents you need, it’s a good idea to contact your chosen mortgage lender in Colorado Springs to know exactly what documents you’d need to prepare.
Total Lending Concepts is one of the top lenders that can provide you with a home loan in Colorado Springs. We offer several loan options that can meet your specific needs. Contact us today to know more about our home loans!
