Applying for a Mortgage
A few documents are needed to get a loan file through underwriting. Some of the information will be gathered online or over the phone. A lot of it will already be stated in some documents you’ll provide, like employer address which can be found on a pay stub. While the list looks long, it won’t take much effort to round them up. The lists below will help you keep track. Your loan officer will also indicate which items will not be needed and also help you prioritize which items to send in first.
- Name of current employer, phone and street address
- Length of time at current employer
- Salary including overtime, bonuses or commissions
- Two years of W-2s
- Profit & Loss statement if self-employed
- Pensions, Social Security
- Public assistance
- Child support
- Bank accounts (savings, checking, brokerage accounts)
- Real property
- Investments (stocks, bonds, retirement accounts)
- Proceeds from sale of current home
- Gifted funds from relatives (e.g. down payment gift for FHA loan)
- Current mortgage
- Child support
- Car loans
- Credit cards
- Real property
Your real estate agent will be able to grab some of the harder-to-find items such as property taxes.
- Street address
- Expected sales price
- Type of home (single family residence, condo, etc.)
- Size of property
- Real estate taxes (annual)
- Homeowner’s association dues (HOA)
- Estimated closing date
Be prepared to explain any missteps in your financial background. It’s good to have dates, amounts, and causes for any of the following:
Type of Mortgage
- Fixed or adjustable
- Forward or reverse
- Government-insured: VA, FHA, USDA
VA Certificate of Eligibility (COE)
If you are applying for a VA LOAN you will need proof of your military service. The VA can provide a Certificate of Eligibility (COE). Your lender will be able to pull it for you. If you want to get it yourself, you can do so via the eBenefits website.
All the documentation from above is pulled together to produce the Loan Estimate. The loan estimate describes the terms and predicts the costs associated with your loan. By law, you must receive it within three days of your application.
The Loan Estimate includes closing costs, the interest rate and monthly payments (principal, interest, taxes and insurance). A notification is included if interest rates can change in the future, as would be the case with Adjustable Rate Loans (ARMs). It also includes information about any special features such as pre-payment penalties or if the loan balance can ever increase in spite of you paying on time (called negative amortization).
At this stage, you’re not yet approved nor denied a loan. A loan estimate is simply a statement of the terms and estimated fees in plain English. It’s like getting an estimate for car repairs; no one has picked up a wrench yet, you’re just getting a sense of the work that will be done and how much it’ll cost.
Quick note: Most types of loans — but not all — use the Loan Estimate at the application stage. Some loan products, like reverse mortgages, still use two older forms – the Good Faith Estimate (GFE) and Truth-in-Lending (TIL) disclosure.
You can get a sneak peek of what Loan Estimates look like plus an even more detailed explanation of each section of it on the Consumer Financial Protection Bureau (CFPB) website.