As I have had more people asking to get a mortgage approval, I thought it was time to remind everyone what you need for that approval!
Most of the information loan officers will ask for is very basic – I usually say 2 2 2! Meaning 2 of everything! There are some cases where we will need additional information but it depends on your file.
The basic information you will need is:
- 2 paystubs (the last two you have received)
- 2 months of bank statements (all pages!)
- 2 years of tax returns including your w-2's
That's where the 2 2 2 comes from!! Other items that you may need are:
- divorce decree
- bankruptcy docs
- foreclosure information
- social security award letters
- corporate or partnership tax returns
- VA documents such as DD 214 and Certificate of Eligiblity
- Net sheet on the sale of your current home
- Gift letter if you are getting a gift for closing costs or down payment
- First time homebuyer class if needed for down payment assistance
When you meet with your lender, you will need as much of this information as possible. Your loan officer will pull your credit report and go over it with you. Once your loan officer has calculated your income, they will be able to tell you how much you can qualify for. It may vary depending on whether you are buying a single family home or a townhome/condo. The property taxes and association dues will change what you can qualify for.
Once you have found your home and have an accepted purchase agreement, your lender will order an appraisal for you. You will also need to get a copy of the cancelled earnest money check, plus homeowners insurance. Your lender will also order titlework to make sure you get clear title to the property.
The more information you can provide to your lender, the more accurate your approval will be and the easier the process will be! If there are large deposits into your bank account, make sure you keep records of where the money came from. During the processing you may get some phone calls or emails asking for more information. The sooner you can get the information back to your loan officer, the sooner they can get an approval out to you! If you aren't sure about something, ask – I would much rather have a buyer ask me about a deposit or buying something, then find out right before closing! Lenders are going to pull an updated credit report – it's not a full report, but a file that tells us if there are any inquiries and if there is new debt. That may affect your approval.
Once your lender has everything, they submit the file for final approval. Then you are ready for closing! Ideally we like to have the approval a few days before closing, but that doesn't always happen!! Your loan officer should call you with your final numbers so you do not have any surprises at closing. As always, if there are any questions, make sure you ask!