Information and Documentation You’ll Need For A Home Loan Application

For some, applying for a home loan can be a confusing and somewhat unsettling experience. By gathering the proper information ahead of time, the application procedure will be much easier and may help expedite your loan approval. The information here will help you assemble and organize the financial records you'll need to complete your loan application.

Lenders used to mailed out verifications to employers, banks, mortgage companies, etc, in order to verify the information and documentation supplied by borrowers. Today speed is of the essence, everyone want to know if they are approved yesterday, so "alternate documentation" has become more widely used. Alternate documentation means that your loan can be approved based on the information and documentation you supply instead of waiting around for verifications to come back in the mail. Below is a list of the required information for most standardized loans. Verifications are still mailed out, but usually as part of quality control procedures.

Have these items ready when you apply for a loan:

Income items

• W-2 forms for the last two years – Include address and telephone numbers for employers for past 2 years.
• Pay stubs covering the most recent 30 day period
• Federal tax returns (1040’s) for the last two years, if:

• You are self-employed
• Earn more than 25% of your income from commissions or bonuses
• Own rental property
• Or are in a career where you are likely to take non-reimbursed business expenses

• Year-to-date profit and loss statement (for self employed)
• Corporate or partnership tax returns (if applicable)
• Pension award letter (for retired individuals)
• Social security award letters (for those on social security)
• 1099’s (if significant and recurring income from dividends and interest)

• Bank statements for previous two months (sometimes three) on all accounts. All pages.
• Statements for two months on all stocks, mutual funds, bonds, etc
• Copy of latest 401k or IRA statement (or other retirement assets)
• Explanations for any large deposits and source of those funds
• Copy of HUD-1 settlement statement on recent sales of homes
• Copy of estimated HUD-1 settlement statement if a previous home is for sale, but not yet closed
• Gift letter (if some of the funds come as a gift from a family member)
• Gifts may also require:

• Verification of donor’s ability to make the gift (bank statement)
• Copy of the check used to make the gift
• Copy of the deposit receipt showing the funds deposited into bank account or escrow

Credit items

• Landlord’s name, address, and phone number and if available copies of last 12 months cancelled rent checks for verification of rental payment history.
• Explanations for any of the following items which may appear on your credit report:

• Late payments
• Credit inquiries in the last 90 days
• Charge-Offs
• Collections
• Judgments
• Liens

• Copy of bankruptcy papers if you have filed bankruptcy within the last seven years

• Copy of purchase agreement (if you have already made an offer)
• To document receipt of child support (if you desire to show it as income)

• Copy of divorce settlement (to show the amount)
• Copies of twelve months canceled checks to document actual receipt of funds

• Copy of social security card (or other documentation of social security number)
• Copy of driver’s license

• Copy of DD-214 Certificate of Eligibility or Separation and Discharge