Documents Needed For A Home Loan

Dated: 03/04/2018

Views: 205

mortgage documentsIf you decide to refinance or purchase a home with a mortgage, you will be required to fill out a loan application form and sign a set of disclosures in order to initiate the mortgage process.

This bundle of documents includes things like the Truth in Lending disclosure, the Good Faith Estimate, the HUD-1, Credit Report disclosure, a Social Security release form, and many more.

The GFE and TIL and HUD-1 have since been replaced by the “Loan Estimate” and the “Closing Disclosure.”

These disclosures provide important details about your loan and allow the bank or mortgage broker to gather sensitive information about you such as employment and credit history, bank statements, income documents, and so forth.

When all the disclosures are signed, the loan process can begin.  At that time, the loan officer or mortgage broker will collect important documents from you and submit your loan application to the underwriter.

[Do I even qualify for a mortgage?]

If your mortgage application is approved, you will receive a conditional approval from the mortgage underwriter with a set of conditions that need to be met in order to receive loan documents. These are called “prior to document” conditions, or PTDs, because they must be satisfied before loan documents can be drafted and sent out.

Once loan documents are signed, “prior to funding” conditions will need to be met to ensure the loan actually funds and records. These are usually sent back along with the loan documents from title/escrow.

Below are some of the basic documents you’ll need to provide to effectively get your loan funded based upon documentation type:

Full Doc:

Signed loan application
Latest 2 years tax returns and/or pay stubs
Latest 2 months bank statements, Verification of Deposit (VOD), or other acceptable asset reserves
*CPA letter and/or business license if self-employed stating 2+ years employment in same job or field.
The bank or lender will call your employer if you are W-2 and do a verification of employment.
Gift letter for down payment (if applicable)
Rental history (typically 12 months of cancelled rent checks) if currently renting or VOR
Home Appraisal
Preliminary Title Report
Proof of insurance (Hazard, Flood, etc.)
Signed Disclosures
Letter of Explanation(s) (for any issues that need clarification)

Stated Income Verified Assets:

Signed loan application
Income is simply stated (written) on the 1008/1003 (loan application)
Latest 2 months bank statements, VOD, or other acceptable asset reserves
Home Appraisal
Insurance (Hazard, Flood, etc.)
Letter of Explanation(s) (for any issues that need clarification)

No Ratio:

Signed loan application
No income information is provided whatsoever
Letter of Explanation(s) (for any issues that need clarification)

No Income No Assets:

Signed loan application
*CPA letter and/or business license if self-employed stating 2+ years employment in same job or field,
Letter of Explanation(s) (for any issues that need clarification)

No Documentation:

Signed loan application
Income, assets, and employment are not revealed to the bank or lender.
A CPA or business license is not necessary.
Letter of Explanation(s) (for any issues that need clarification)

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