If you’re like me, you HATE pulling together piles of documents that were probably filed under stacks of kids homework from two years ago.  Just thinking about having to find all those documents gives me the heeby-jeebies.  At Loanatik, we strive to make mortgage applications as simple and easy as possible. And the CFPB’s own home-buying preparation guide is a good independent resource too, by asking for the least number of documents and using “Big Data” when we can.  Alas, there are some times when you will have to come up with some documents that aren’t available in the cloud. This mortgage document checklist covers exactly what you will need.

Well-meaning friends and inexperienced loan officers get way more documentation than the mortgage guidelines really require.  You don’t need to document your entire life in minute detail.  It’s really just some common sense documents that we ask for.  If you’re purchasing a home, we’re going to need the purchase contract.  If you tell us who your realtor is we can contact them directly to save you the hassle.  There are also streamline programs for both VA and FHA that make applying for a refinance a breeze.  Bottom line is that we’re here to help in every way we can. You shouldn’t let a document or two stand in the way of getting your home purchased or refinanced.  Here is a mortgage document checklist of some of the more common documents that might get asked for. It also includes a list of some special case documents, like the mortgage documents required for someone who is self-employed or received a large gift.

Mortgage Document Checklist

W-2 forms from the previous two years, if you collect a paycheck.

Profit and loss statements or 1099 forms, if you own a business.

Recent paycheck stubs.

Most recent federal tax return, and possibly the last two tax returns.

A complete list of your debts, such as credit cards, student loans, car loans and child support payments, along with minimum monthly payments and balances.

List of assets, including bank statements, mutual fund statements, real estate and automobile titles, brokerage statements and records of other investments or assets.

Canceled checks for your rent or mortgage payments.

Documenting Income

One of the most important parts of getting a mortgage is documenting your income.  Required documents vary by loan program and your income and asset profile. Salaried borrowers are commonly asked for recent pay stubs and W-2 forms. Tax returns, bank statements, and business returns may also be needed depending on the loan program, the income used to qualify, and the assets being verified.  In the initial set of disclosure document that we send you, there’s a document that gives us permission to check the information that the IRS has on file.  All of this is really common sense and has become standard practice in the mortgage industry because of all the fraud we experience in the mortgage madness from 2004-2007.  For most covered mortgages, federal ability-to-repay rules require lenders to verify the income or assets they rely on when evaluating repayment ability. The documents needed depend on the loan program and your circumstances.

Alternative Documentation

If you don’t have the documents we just outlined, don’t fret!  We can still document your income in other ways.  We can use bank statements and other forms of income documentation.  You might not get rates as low as someone that can easily document their income, but, you may still be able to get a mortgage.

Documenting Unusual Transactions

If you receive a gift or have a large or unusual deposit, you may need to document its source. The documentation and thresholds depend on the loan program and your circumstances. For a gift, the donor may be asked to provide a gift letter and supporting records so the underwriter can confirm that the funds are not a loan that must be repaid. Borrowing money like that would change your debt-to-income ratio.  Other large deposits, like quarterly commission checks, also have to be documented. But those count toward your income if you can demonstrate that the income has been stable in the past and likely to be stable in the future.

Some more special cases:

• Child Support.  If you choose to use child support, alimony, or separate-maintenance payments as qualifying income, we may need the decree or agreement and evidence that the payments have been received consistently.
• Self Employed & Commission Income.  If you’re self-employed you’ll have to supply the tax returns for the business for the last two years.  We’ll probably ask for a year to date profit & loss statement and balance sheet as well.
• Bankruptcy.  A bankruptcy can make things more complicated.  You’ll certainly have to show the court documents showing that the bankruptcy has been discharged, the reason for the bankruptcy and a variety of other documents.  Your credit report will also have to show that your credit has been clean since the filing.  There are also waiting times after a B/K has been discharged before you can get a loan from Fannie Mae or Freddie mac.
• Foreclosure.  You may become eligible to apply for an FHA mortgage three years after a foreclosure completes, and for a conventional loan after seven years. Meeting the waiting period makes you eligible to apply — it does not by itself mean you will be approved.

Making Mortgage Easy

With incredible numbers of really smart programmers, Loanatik is leading the way to fully automating mortgage applications, processing, and underwriting.  All of this means that your application will get easier. And closing cost will become more affordable and closings will be faster.  Don’t let outdated advice and ghosts of mortgage past haunt you into not applying.  We really can help and make the process as easy and painless as possible.  You can start saving money by filling out the quick and easy loan application.

Get our FREE mortgage document checklist

We’ve put everything you might need into this easy-to-use mortgage document checklist.  Just click on the download link and we’ll send it to you email address in a jiffy!

[wpdm_button_template id=528 style=”green” align=”left”]