Although the specific requirements will differ from lender to lender, the following documents are typically requested when applying for a mortgage loan:
Mortgage lenders or banks will require copies of the borrower's paystubs in order to verify employment and compensation information. The lender may request stubs anywhere from two weeks to three months prior to the application. If the buyer receives any bonus pay or incentive, they will also be asked to bring in records of those payments. In addition to pay stubs, any other type of income should be included in the borrower's files. This may include any type of regular allowance, pension, or survivor's benefits. Banking information will need to be provided in order to verify how much the borrower had been receiving from those additional income sources. Bank statements Checking or savings account statements for the last several months will be requested in order to verify financial stability. The lender will also be checking to see if the borrower has enough money in their accounts to cover the cost of the down payment and necessary closing costs. Any large deposits within that time frame should be properly documented in order to not cause any suspicion with where the borrower obtained the money. Employment verification Sometimes submitting pay stubs will suffice as verification of employment, but other times potential borrowers will need to have their employer fill out some paperwork. Salary, length of employment, and employment status could all be included in the employment check. Tax returns The lender will need to review the applicant's tax information for the previous year or two. In some cases they may ask the borrower to bring in their paperwork, but some lenders may simply have them sign a tax transcript request to be sent to the IRS. Lists of assets and investments The lending agency will want to know if the applicant owns any valuable assets, real estate, stocks, or other investments. The amount each asset is worth should also be noted. Debt information The borrower's income-to-debt ratio will be taken into account during the loan application process, and the lender will request copies of their credit report. This will help the bank to determine how credible and reliable the borrower is in terms of debt repayment. A loan application may be rejected if the lender discovers the borrower is not paying their bills on time. Additionally, in order to gain information on whether or not the prospective borrower is paying their bills on time, the lender may request a current rental verification. This way they can check with the borrower's landlord to ensure that they had been paying their rent on time. Proof of retirement income If the borrower is retired, the bank may also need to verify income received in the forms of 401K statements, pension information, and social security statements.
