While the exact forms may vary, Todd Huettner, owner of Huettner Capital, a residential and commercial real estate lender, says that a lender can get a good idea of your chances of being approved by looking at your recent paystubs, bank statements, W-2 forms and tax returns. Mortgage lenders want to know the full story of your financial situation. You'll probably need to sign Form 4506-T, which allows the lender to request a copy of your tax returns from the IRS. Lenders generally want to see tax returns for one or two years.
This is to ensure that your annual income matches the income reported through payment receipts and that there are no large fluctuations from year to year. Lenders may ask you to see your payment receipts for the last month or so. Their tax returns help them get a clear picture of their overall financial health, while pay stubs help them measure their current income. If you are self-employed or have other sources of income (such as child support), you may need to show your lender proof using 1099 forms, direct deposits, or other means.
You and your co-borrower (if applicable) must complete your personal information, including your name, current address (and if you rent or own), previous address (if less than two years) (and if you rented or owned), social security number, telephone number, marital status, date of birth, number of years of education, and number of dependents. The lender will use this information to prepare your credit report. The first section of the mortgage application asks you to indicate the type of mortgage you are looking for, such as a conventional or FHA mortgage. These expenses include current rent or mortgage payment, mortgage insurance, taxes and homeowners association fees, basically any expenses related to housing.
Lenders will request documentation for your mortgage application that shows things like how much money you earn and your debts. Before you fill out your mortgage application, it's smart to gather the necessary documents and information ahead of time, especially if a mortgage lender helps you in person or over the phone. Learn how mortgage payments work, how to repay them, and the advantages and disadvantages of monthly versus biweekly mortgage payments.
