Mortgage Loan Documentation

During the application process, the lender must decide how likely it is that you'll be able to keep your promise of repayment. Your credit history, income, and current debt level are the main factors used to make this determination. In order to scrutinize your qualifications, the lender will ask you to provide some, or all, of the following:

• A copy of the property sales contract.
• Address of residence for the last two years.
• Employment information for the past two years.
• Confirmation of income:
  • Salaried employees: W-2s for the past two years.
  • Self-employed: Signed business and personal tax returns for the past two years, year-to-date income statement and balance sheet, business licenses for the past two years.
  • Commissioned employees: Signed tax returns for the past two years.
• Pay stubs for the most recent 30 days.
• Bank statements to verify down payment funds.
• Any bankruptcy or divorce documents.

For some borrowers, income verification presents the biggest hurdle. If you've recently started your own business, you may not have two years of tax returns documenting your current income level. You can still get a mortgage loan in these situations, however; just be prepared to pay higher interest rates.