Mortgage Application Basics
Posted by: Greg Fischer Post date: July 7th, 2011A mortgage loan application is a “simple” 4 page document that collects information about employment and income, assets, debts, credit, and a host of personal information as well. All of this is designed to put all of the key elements required to get a mortgage loan approval in one document. But before you sit down with a mortgage professional to complete this application (and a stack of other paperwork as well) here are the basics of what you’ll need to have ready to complete it:
Personal information including birth date, marital status, number of children and ages. Loan applications are Federal documents and require this data. Good loan agents use it to help with family and retirement planning.
Residence history for at least two years. If renter, rent payment is needed. If owner, all mortgage, insurance and tax figures are needed.
Employment history and income for at least two years. That’s 2 years of tax returns (all schedules) and W2′s if applicable. If you receive commissions or bonuses, you need two years of figures—all lenders average variable income (including self-employed income) over two years. Full tax returns for two years are always required, including business taxes if you’re a business owner. You will also need 2 paystubs less than 30 days old.
Asset balances including all pages of all checking, savings, investment, and retirement accounts. If you move money among accounts, you must provide all accounts even if you’re only using one account for the down payment, because the lender will review every line item on two months of full account statements and ask to paper-trail large deposits and withdrawals. If the statement says Page 1 of 8 – you are going to need 8 pages.
Debt payments and balances for credit cards, mortgages, student loans, car loans, alimony, child support, or anything else. Most of these are available on the credit report once you get to the point where a credit report is required.
Social security number A good loan agent can use the verbal debt information to estimate your credit score which is needed for loan qualifying and rate quotes, but eventually you’ll need to provide your social security number so lender can verify with a credit report.
If you have all of this information ready for the initial meeting, and the paperwork to support it, that will streamline the application process and help to eliminate surprises prior to closing. The best way to ensure a smooth loan process is to be prepared up front.
