Applying for home loan is a exciting venture but it also helps to be a little informed before jumping into the home loan boat. Gathering personal documents and information on your assets and liabilities are a crucial step to the process. Here are the main documents you’ll need to apply for a home loan.
#1. Pay stubs, W-2s, or proof of income.
Lenders and underwriters must have valid and legal proof of your income before loaning you money. This could be with a copy of your pay stubs, W-2s, tax returns, or any proof of income even for self-employed individuals.
#2. Bank statements.
Many self-employed applicants may be able to use bake statements as proof of income. Not only do lenders want to know how much income household has but they want proof of that with bank statements and how much money is actually going in and coming out.
#3. Credit history.
Lenders will typically pull a copy of your credit report with your verbal or written permission. If there’s any odd errors or mistakes on your credit history they should be explained if possible.
Lenders need to know that it is actually you applying for the home loan and not someone else with a similar name. They will need a copy of your driver’s license, birth certificate, or other proof of identification.
#5. Payment history.
Lenders want to see that you have a good payment record for paying your bills on time, rental history, even utilities, and medical bills.
There may be other documents needed depending on the type of loan and where your down payment is coming from. Lenders might want to see gift letters if you’re planning on receiving gift funds for your down payment. They want to verify that it does not have to be paid back. Tax returns may also be required but this may be on a case-by-case basis. Everyone’s income and financial situation is slightly different but these are the most common documents you’ll need to pull together when applying for a home loan. However, if you have any questions and before stressing out about the documents, simply give us a call. We can run over some numbers and ask a few questions to determine the appropriate documents you’ll need for your loan.