Purchasing a home is a significant milestone in one's life, but for most people, it also involves securing a mortgage. Mortgage lenders have strict criteria to determine your eligibility for a home loan, and they rely heavily on various documents to make their decision. In this blog post, we'll walk you through the essential documents needed to get a mortgage approval, helping you prepare for this crucial step in your homeownership journey.

Proof of Income

During the pre-approval process, we want to assess your financial stability. To get started, you will need:

a. Paystubs: Recent paystubs from the last 30 days.

b. W-2s or 1099s: Past two years of these forms that outline your annual earnings and tax obligations.

c. Tax Returns: Your federal tax returns for the past two years, along with all schedules and attachments, particularly if you're self-employed.

Employment Verification

We'll need to confirm your employment to gauge your job stability. Please have ready:

a. Verification of Employment (VOE): A form signed by your employer, including your job title, start date, and income details.

Proof of Assets

To demonstrate your financial capability, prepare to provide proof of funds for your down payment. This should include:

a. Bank Statements: Past two months of statements for all your bank and investment accounts to illustrate your available funds.

b. Gift Letters: If you anticipate receiving gift funds from a relative or friend for your down payment, a signed gift letter stating it's not a loan will be essential.

Credit & Debt Information

While this is a pre-approval, a credit pull to view your credit history remains vital. We'll check your credit reports from Equifax, Experian, and TransUnion. We will also be able to view all your existing debts to helps us calculate your debt-to-income ratio (DTI), a significant factor in mortgage pre-approval. Your mortgage advisor will guide you on pulling your credit.

Identification

To validate your identity and citizenship status, you'll typically need:

a. Driver's License or Passport: A valid government-issued ID.

b. Social Security Number: Your SSN card or documentation confirming your SSN.

Property Information

While this is a pre-approval, we appreciate having details about the property you're considering. This isn’t necessary but if you have a property in mind already it is worth mentioning:

a. Property Address: The address of the home you intend to purchase.

b. Purchase Agreement: If you've already signed a purchase agreement, providing a copy would be beneficial.

Securing a mortgage pre-approval is a significant step toward your homeownership goals. By understanding the necessary documents and organizing them effectively, it will simplify this early stage of your home buying journey.