With your decision made and the groundwork laid, it's time to put all the pieces of documentation needed to move forward into closing.
Documents Needed For All Loan Applications
ALL BORROWERS:
Just like you wouldn't dive into a pool without knowing how deep it is, you wouldn't want to house hunt without knowing how much you could afford. That's why once you have decided buying a home is your best option and you've examined what your finances will allow, it's a good time to talk with your SymbolicLending Loan Officer about being prequalified or preapproved.
Prequalified
In a prequalification letter, the lender has been provided the buyer’s financial details and, based on verification of these details, agrees to give a loan to the buyer. A credit report is not required at this point.
Why Bother?
Knowing how excited many homebuyers can be, it can seem frustrating to add a step before the house hunt. However, there are several advantages to being prequalified/preapproved that can make it worthwhile.
Next: Chapter 4: Finding your Home
Documents Needed For All Loan Applications
ALL BORROWERS:
- Copies of W-2's for the last two years;
- Copies of paycheck stubs for the last 30 days (most current);
- Copies of checking and saving account statements for last three months (all pages);
- Copies of quarterly or semi-annual statements for checking, savings, IRA's, CD's, money market fund, stock, 401k, profit sharing, etc.;
- Copy of sales contract when ratified;
- Employment history for the last two years (address any gaps of employment);
- Residency history over the last two years, with name, phone number, address and account number of Land or Mortgage Company. Rental property copies of leases plus mortgage information.
- Canceled earnest money check when it clears or corresponding bank statement, if applicable;
- Commissioned or income from bonuses-- if 25% or more of base, must have tax returns;
- Check for the expense of appraisal & credit report;
- Refinance Copy of Note, Deed of Trust, Settlement Statement, Survey, and Insurance information;
- Any assets used for down payment, closing cost, and cash reserves must be documented by a paper trail;
- If paid off mortgage in the last 2 years, need copies of HUD1;
- Copy of drivers license for applicant and co-applicant.
- Copies of most recent 2 years tax returns (with all schedules including k-I's if applicable);
- Copy of current profit & loss statement and balance sheet;
- Copy of corporate/partnership tax returns for most recent 2 year period if owning 25% or more of company -- copies of W-2's and/or 1099 forms.
- Relocation Agreement if move is financed by employer, i.e. buyout agreement plus documentation outlining company paid closing costs benefits;
- Previous bankruptcy, need copies of petition for bankruptcy and discharge, including supporting schedules;
- Divorce Decree if applicable;
- Documentation supporting moneys received from social security/retirement trust income, i.e. copies of direct deposit bank statements, awards letter, evidence income will continue.
- FHA: Copy of social security card and drivers license for each applicant and co-applicants;
- VA: Original Certificate of Eligibility and copy of DD214 Discharge Paper;
- VA: Name and address of nearest living relative
Just like you wouldn't dive into a pool without knowing how deep it is, you wouldn't want to house hunt without knowing how much you could afford. That's why once you have decided buying a home is your best option and you've examined what your finances will allow, it's a good time to talk with your SymbolicLending Loan Officer about being prequalified or preapproved.
Prequalified
In a prequalification letter, the lender has been provided the buyer’s financial details and, based on verification of these details, agrees to give a loan to the buyer. A credit report is not required at this point.
Why Bother?
Knowing how excited many homebuyers can be, it can seem frustrating to add a step before the house hunt. However, there are several advantages to being prequalified/preapproved that can make it worthwhile.
- Credit challenges or problems that might prevent qualification are discovered and addressed early in the process.
- You will be able to house hunt with confidence knowing that the financial backing that is available to you.
- Home sellers typically see more strength in offers from prequalified buyers.
- For self-employed or commission-based buyers, a prequalification letter can demonstrate financial backing for buyers whose incomes may fluctuate more than those of salaried buyers and therefore possibly demonstrate more risk.
Next: Chapter 4: Finding your Home