Be Aware of the Required Documents for Mortgage Application
Author: Alvin Clavines
In spite of the economic downswing that many countries in the world are currently experiencing, real estate remains one of the booming industries. For those who are thinking of venturing into home purchase, it is important to understand the essential components in the real estate market such as home mortgage. Home buyers need to submit the necessary documents for mortgage application before their prospective lender qualify them for a mortgage or issue a loan. Other than the personal identification, financial documents are very common requirements when applying for mortgage loans. This documentation is normally presented to the bank or mortgage lender. Determined by conditions of the mortgage company, a broker may validate some of the information or the underwriter will confirm all of the details. The bank confirms a potential buyers financial information, when this is done the underwriter can move on to process the mortgage. In case the information is unclear or cannot be checked out, the mortgage broker will ask the potential buyer for extra documentation. In most cases, your prospective lender will ask prospective home buyers to submit the following requirements before applying for a loan or issuing a mortgage. Almost every mortgage brokers or banks will want to see copies of pay stubs from the last three months prior to the loan application. If it happens that a prospective buyer owns a business or works on a commission basis, there is a need to provide more documentation of income. This means the prospective buyer has to provide pay stubs for the past 12 months or profit loss report. For home buyers who are already retired, the bank may request proof of retirement income. This can be social security reports, IRA or 401K reports, or pension reports. The potential buyer may also need to present bank account statements for the last three months. The bank may also ask the prospective buyer to submit bank account statements for the past three months. If you have both checking and savings accounts, you should submit statements for the two accounts. The prospective home buyer may also need to furnish a copy of their current lease or form signed by the landlord. The mortgage broker or bank will want to see this document so they can contact the landlord and verify rent paid and to know if you pay on time. There are times that the bank asks for an employment verification form. This form can be provided by your employer. The content of form includes in details of your salary, duration of employment, weather there will be a change in your employment status and scheduled raise. The lender will ask you to submit a least a years tax returns in the documents required for mortgage loans. Many lenders will look for up to three years of tax returns. You must be able to submit the full tax return. Since most home buyers do not have enough financial resources for the purpose of purchasing a home in full payment, lending companies and banks are imposing the required documents as necessary and impose other tight standards to apply and get approved for home mortgage.About the Author:
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