Proper Planning for Your Mortgage Application

Mortgage Application PictureWith good preparation, most things are easier. That works in mortgages too! Today, I want to give you some ideas that can make your mortgage experience less painful.

Income Items:

  1. Gather your documents. Today, many people will have to produce 2 years’ complete tax returns, including W2′s, 1099′s, K1′s, and all the schedules, as well as a month’s worth of pay stubs.
  2. Be prepared to explain them. Deductions in your returns and your pay stubs may impact the income your lender will use to qualify you which, in turn, has a big impact on the loan you will get.
  3. Have a breakdown of base pay versus overtime for both your pay stubs and 2 years’ W2′s. Lenders treat overtime (and bonus income) differently than your base pay. Be prepared to explain any changes over the last few years because your loan officer will ask you about it.

Asset Items:

  1. Start accumulating your bank statements. Lenders look back 3 months from when you sign your contract of sale.
  2. You will have to explain any and all large deposits (which are defined as deposits greater than your regular pay check) because lenders want to make sure you haven’t taken out any new loans that aren’t on your credit report.
  3. Avoid any significant cash deposits. However, if you did have a cash deposit, understand that the lender will have you source it (a bill of sale and DMV receipt for that motorcycle, for example).
  4. If you will be receiving a gift, consult your loan officer on how to document it (from the donor’s ability to how you deposit it).

To continue reading please click over to the KCM Blog   Copyright © 2012 Keeping Current Matters, by Dean Hartman

For more information about qualifing for a mortgage and the application process contact SHELTER | Urban Real Estate today at 813.769.9371 or info@SHELTERtampa.com.

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