Mortgage Approvals : Documents You'll Need For Your Lender

Mortgage Approvals : Documents You'll Need For Your Lender

According to the Federal Reserve's quarterly Senior Loan Officer Survey, it's getting easier to get approved for a home loan.

Between July - September 2012, fewer than 6% of banks tightened mortgage guidelines -- the fourth straight quarter that's happened-- and roughly 10% of banks actually loosened them.

For today's buyers and refinancing homeowners in Montgomery County, softening guidelines hint at a quicker, simpler mortgage approval process; one which gives more U.S. homeowners better access to today's ultra-low mortgage rates. 

However, although banks are easing guidelines, it doesn't mean that we're returned to the days of no-verification home loans. Today's mortgage applicants should still expect to provide lenders with documentation to support a proper loan approval.

Some of the more commonly requested documents include :

  • Tax returns, W-2s, and pay stubs : In order to prove income, lenders will want to see up to two years of income documentation. Self-employed applicants may be asked for additional business information. Borrowers earning income via Social Security, Disability Income, Pension or other means should expect to provide documentation.
  • Bank and asset statements : To verify "reserves", banks will often require up to 60 days of printed bank statements, or the most recently quarterly reports. Be prepared to explain deposits which are not payroll-related -- banks adhere to federal anti-money laundering laws.
  • Personal identification documents : To verify your identity, banks often require photocopies of both sides of your drivers license and/or U.S. passport, and may also ask for copies of your social security card.

In addition, if your credit report lists collection items, judgments, or federal tax liens, be prepared to discuss these items with your lender. Sometimes, a derogatory credit event can be eliminated or ignored during underwriting. Other times, it cannot.

The more information that you share with your lender, the smoother your mortgage approval process can be.

As the housing market improves and lender confidence increases, mortgage guidelines are expected to loosen more. 2013 may open lending to even more mortgage applicants.

For help or questions contact:

Joe Gonzalez

Senior Loan Consultant -  NMLS #126036
GMH Mortgage Services, LLC
625 W. Ridge Pike, Building C, Suite 100 | Conshohocken, PA  19428 | Direct: 610-355-8039 |  Cell: 610-739-6563

FHA Jumbo Loan, Mortgage King Of Prussia   FHA Jumbo Loan, Mortgage King Of Prussia   FHA Jumbo Loan, Mortgage King Of Prussia

This material is non-exclusively licensed to Joe Gonzalez and may not be copied, reproduced, or sold in any form whatsoever. Copyright ©2006-2014, Bring the Blog. All rights reserved. Terms of Service.
Comment balloon 3 commentsJoe Gonzalez • November 29 2012 06:34AM

Comments

Always love to hear that it is getting easier to get approved for a loan.

Posted by Rob Lang, Local Expert in Lawrence Kansas Real Estate Homes (At Home Kansas Team Powered by Keller Williams Partners Inc / www.AskRobLang.com) about 6 years ago

I hear it is getting easier but haven't seem that yet. Still one step short of impossible.

Posted by Bill Reddington, Destin Florida Real Estate (Re/max Southern Realty) about 6 years ago

@Lawrence - it is "supposed" to get easier but I'll agree with Bill in saying that it's still a challenge.

@Bill - A lot of it has to do with the loan officer preparing the client ahead of time, the processor who prepares the file for underwriting & ultimately the underwriter.  

I prepare my clients by letting them know at preapproval that we will want everything including the kitchen sink.  My processor Anthony is great at finding issues & presenting a clean package to the underwriter along with letters to fill in the gaps if any. 

Once you do those 2 steps it becomes a lot easier to manage the rest of the process. 

Posted by Joe Gonzalez, NMLS# 134407 (610) 739-6563 (GMH Mortgage Services LLC) about 6 years ago

Participate