Getting Ready to Apply for a new Mortgage

What can you do to help your chances of being approved for a mortgage?  Basically,  pay everything on time and do NOT open any new credit or let anyone pull your credit after you have applied for your new mortgage.  This is a good time to start collecting the supporting documentation that your lender may request.  Most purchase agreements request a closing within 30 to 45 days from acceptance of the purchase agreement so start now on gathering your documents so you won’t be unduly stressed!

 Lenders are looking for buyers with a stable work history.  It is best that you have at least 2 years on your current job.  If you haven’t been at your job 2 years is it at least in the same line of work for the past 2 years?  Or, have you been in school?  Most lenders will want your last 2 years W2’s and last 2 years federal taxes, your last 30 days of paystubs.  If you are in school and do not have a work history, they will need your transcripts.

If you have any student loans the lender will need a letter on the student loan companies’ letter head that has your name and account numbers that match the account number on the credit report, stating your loans are differed out at least 12 months AFTER you close on the new house.  If the loans are not deferred out at least 12 months they will need a payment amount and a first payment due date.

If you are currently paying rent make sure you keep all your cancelled rent payment checks, the lender will want to see front and back.  If you cannot print front and back online your bank should be able to help you.  You will want to give the name and contact information of your landlord or apartment complex to your lender as they will also usually verbally verify that you have made all payments on time one more time before closing.  If you are paying with money orders or cash your lender will need to advise you on what they will need.

You will need to give to your lender your last 2 months checking account statements, all pages, even if the last page is blank.  If your statement says page 1 or 7, the underwriting department will require all 7 pages.

If your down payment is not coming from your checking account you will need to provide a statement of the account it is coming from. 

If you are receiving a gift of funds towards the purchase of your new home you will need to get a gift letter from your lender for you AND the donor to fill out.  The lender will want written documentation of the funds coming out of the donors account and written proof of the funds going into your account.

Your lender will need a copy of your completed purchase agreement and a copy of the earnest money check.  If some else writes the earnest money check this will be considered a gift and you will need to follow the gift procedures.

You will need a clear copy of your driver’s license, cannot be expired at any time during the loan process.

You will need a copy of your social security card.  If you cannot find your social security card you will need to get a new one.  If there is not time to obtain a social security card your lender can advise you of alternatives for your situation.

If you have a joint checking/savings account and only one of you will be on the mortgage the NON buyer will need to write a letter authorizing the buyer to use any and all funds towards the purchase of the new home.  

Good luck in your new home search  please give me a call at 317-694-9745 if I can help you with your real-estate needs in Central Indiana,

Serving:

(Avon, Brownsburg, Camby, Coatesville, Danville, Fishers, Fortville, Greenfield, Greenwood, Lapel, Lebanon, Martinsville, McCordsville, New Palestine, Noblesville, Pendleton, Plainfield, Speedway, Westfield or Zionsville)!  - Michelle Honeycutt