Common Documents Required For A Mortgage Pre-Approval

Today, a number of lenders are quoting 10-minute mortgage pre-qualifications online or over the phone. But only a mortgage approval that has been issued by an underwriter holds weightage, as the person has the opportunity to thoroughly review all the required documents.

The lending guidelines are constantly changing, the government is pulling in the reins on regulations and there is a lot of volatility in mortgage rates. With all these factors in view, most real estate agents require first-time home buyers to have a pre-qualification letter, before they actually show them any new homes.

How a Pre-Approval Helps You

The pre-approval letters helps you in 3 ways:

  • You will know the mortgage amount you qualify for

  • You get a general estimate of what total housing payment will be

  • When you submit a pre-approval letter along with your purchase offer, the seller is more confident that you will be able to meet your end of that agreement

The Documentation

In order to get the pre-approval letter, you are required to fill out a loan application form and submit a few documents, which will be reviewed by the underwriter and/or the loan officer. The common documents that you will have to submit are:

Income / Assets for Wage Earner:

  • Last 2 years W2s & Tax Returns

  • 2 most-recent Pay Stubs

  • 2 most-recent Bank Statements, Liquid Assets, 401(K), Investment Accounts

Income / Assets for the Self-Employed:

  • Last 2 years Tax Returns – Business & Personal

  • Last Quarter’s P and L Statement

Letter of Explanation For:

  • Employment Gap/New Line of Work

  • Late Payments / Bankruptcy on Credit Report /Judgments

Other:

  • Bankruptcy Discharge

  • Any Child Support Documentation

  • Mortgage Payment Coupons (If you own other Real Estate)

  • Lease Agreements (If you own any other Rental Properties)

Be Well-Prepared

The Q&A sessions can sometimes end up being more than just a qualification process and you should have all the right questions & answers ready. In any case, once you have identified a trustworthy loan officer who can meet your expectations, you will need to have all these documents ready. The loan approval process can be very complex and being well-prepared, helps in taking away some of the strain. For more information about the kind of documents you require, contact ResMac Home Loans today.