Getting your loan is the most important piece of the puzzle toward owning a home.
If you are paying cash, you will need to show proof of funds in the amount of the contract purchase price. This is easily done by obtaining a letter from your financial institution verifying that you have the money in your account.
If you need a mortgage, please gather the following prior to your meeting with your lender.
Income Items
W2 forms for the last two years
Most recent pay stubs covering a 30 day period
Federal tax returns (1040’s) for the last two years, IF:
you are self-employed
earn regular income from capital gains
earn sizable interest income, etc.
earn more than 25% of your income from commissions or bonuses
own rental property
or are in a career where you are likely to take non-reimbursed business expenses
Year-to-Date Profit and Loss Statement (for self employed)
Corporate or Partnership tax returns (if you own more than 25% of the business)
Pension Award letter (for retired individuals)
Social Security Award letters (for those on Social Security)
Asset Items
Bank statements for previous two months (sometimes three) on all accounts. All pages, even if you don’t think them important.
Statements for two months on all stocks, mutual funds, bonds, etc
Copy of latest 401K statement (or other retirement assets because they can count as reserves)
Explanations for any large deposits and source of those funds
Copy of HUD1 Settlement Statement on recent sales of homes
Copy of Estimated HUD1 Settlement Statement if a previous home is for sale, but not yet closed
Gift letter (if some of the funds come as a gift from a family member – the lender will supply a blank form)
Gifts can also require:
Verification of donor’s ability to make the gift (bank statement)
Copy of the check used to make the gift
Copy of the deposit receipt showing the funds deposited into bank account or escrow
Note: many get their statements of various kinds over the internet and these are not always acceptable to lenders, especially when the printed version does not contain the borrower’s name, account number, AND the name of the institution.
Credit Items
Landlord’s name, address, and phone number (if you rent)
Explanations for any of the following items which may appear on your credit report:
Late payments
Credit inquiries in the last 90 days
Charge-offs
Collections
Judgments
Liens
Copy of bankruptcy papers if you have filed bankruptcy within the last seven years
Other Documents You’ll Need
Copy of purchase agreement (if you have already made an offer)
To document receipt of child support (IF CONSIDERED AS INCOME)
Copy of Divorce Settlement (to show the amount)
Copies of twelve months canceled checks to document actual receipt of funds
FHA Loans
Copy of Social Security Card (or other documentation of social security number)
Copy of Driver’s license
VA Loans
Copy of DD214