Every client hopes to move through the mortgage process quickly. While the overall speed of the process depends heavily on the chosen lender and their system, there are a few things you can do to help fast-track your mortgage experience.

When you apply for a mortgage, we will request a variety of documents that will help determine your loan approval. These requested documents are a crucial element of the loan approval process. If any of the documentation is late, missing, or incomplete, delays may occur.

However, if you’re familiar with the documents we may request, you can gather them before submitting your loan application and give your loan officer the tools that they need to move quickly.

To make sure you are as prepared as possible, we’ve put together an overview of all of the documents we may request, the best way to provide those documents, and common issues to avoid when gathering this information for your loan officer. Let’s dig into the details.

Mortgage Documents Needed

Here’s a full list of the documents that we typically review before issuing a loan approval. Keep in mind, every client’s financial situation is unique so some of the documents on the lists below may not apply. However, it’s good to know what the possibilities are so your can prepare in advance.

Income Documents

• Paystubs – most recent 30 days
• Federal tax returns – 2 most recent years (all schedules)
• W2’s and 1099’s – 2 most recent years for all sources of income (i.e. retirement, jobs, social security, etc.)
• If you are self-employed – 2 most recent business returns (all schedules)
• Retirement, SSI, disability award letter – most recent

We use the documents mentioned above to ensure that your income history is stable and consistent. The income documents provide proof that you have the financial security needed to repay your mortgage.

Asset Documents

• Bank account – 2 most recent monthly bank statements
• Retirement accounts – (401k, TSP, IRA) – most recent quarterly or 2 monthly statements: must be actual statements including all pages of each statement
• Gift funds – contact us before transferring gift or other funds

We review asset documents to ensure that you have assets to support life’s unexpected expenses. Assets are essential in an emergency, and they show that you are prepared to pay your mortgage and any additional home buying expenses.

Credit-Related

• Landlord contact information – covering the last 12 months
• If rent-free, a signed letter stating you live rent-free from the person allowing it
• Most recent mortgage statement for any mortgages
• Bankruptcy – Copy of discharge & if recent, complete paperwork to show creditors included
• Foreclosure, bankruptcy, short sale – requires a signed, detailed explanation letter

How you’ve paid others back in the past will give us a good indication of how you will pay in the future. Credit-related documentation will also help your loan officer recommend the best loan product. Credit score requirements vary by loan type. If we have a better picture of your credit profile, we can help you choose a loan option.

Miscellaneous

• Color copy of current driver’s license
• Permanent resident alien – a copy of your green card (front and back)

A valid driver’s license or green card will help us confirm your identity. We can also verify that you are either a US citizen or non-resident alien.

• Homeowners insurance agent contact information – let us know if you need a referral

We need to verify that you have homeowners insurance to ensure that your home is protected. If something tragic occurs (like a housefire) we have to confirm that you can recover your investment and continue to repay your loan.

• Divorce decree, separation agreement, child support order – if applicable

The documents listed above are needed for income verification. We need to know if you are paying any form of spousal or child support as this will factor into your debt-to-income ratio.

• MCC Tax Credit (up to $2,000 per year): Need 3 years of tax returns
• USDA or MCC Tax Credit: Income documents from ALL 18 & over household members

These income documents will help your loan officer determine if you are eligible for a government-backed down payment assistance program. Many DPA programs offer a tax credit. Check out this video from Virginia Housing to learn more about the MCC tax credit.

• Closing POA? Talk to us ASAP to complete the required steps for approval

In any case that you aren’t able to be present, your power of attorney (POA) can help you complete the mortgage process.

VA Loan Related

• DD214 if discharged from the military

A DD214 will help your loan officer verify that you’ve completed the appropriate years of service required to be eligible for a VA loan after you’ve been discharged from the military.

• Nearest living relative for each borrower – name, address, phone, and relation to you

If something were to happen to you, we would need to have the ability to contact your next living relative.

• Transfer order – if applicable

In the case of a PCS, your loan officer will need to review your transfer order to ensure that you will be relocating to the area. The transfer order will provide proof that there’s no occupancy issue.

• Current military – statement of service letter from your current command (ask for format)

A statement of service letter helps our loan officers and underwriters verify your military status and recency of service. The document is typically used to confirm that your LES income can count toward loan approval.

The Best Way to Provide Mortgage Documents

1. Provide all requested documents right away
2. Provide all pages of requested tax returns
3. Fully complete the loan application
4. Review the application completely for errors. Better to fix errors up-front.
5. Provide all pages of each bank, investment, or retirement statements
6. Do not deposit large cash amounts into bank accounts or pay earnest money on a contract with cash
7. Look at the documentation before providing to us
8. Provide requested documentation when requested
9. Explain major credit situations by what caused the issue, how it was remedied, and the outlook for the future
10. Ask questions about the disclosures and make sure everything is understood prior to signing.

Common Issues With Mortgage Documents

1. Provide mortgage documents late in the process
2. Missing tax return pages
3. Incomplete application
4. Erroneous information on the application
5. Missing pages on bank statements
6. Excessive cash deposits or cash earnest money
7. Illegible or cut off documents
8. Gradually provide requested documentation
9. No explanation letter for credit or other issues
10. Delays in signing disclosures

If all documentation is not provided up-front, then our mortgage experts cannot review the whole scenario. Receiving surprising documentation with new information later in the process increases the chances of issues (delays) prior to closing. Conversely, if our mortgage team has everything, in the beginning, we can provide an accurate loan approval. Next, any remaining documentation is known and provided back to us. Thus, resulting in an early clear to close the mortgage.

Even if providing the documentation causes a loan denial, at least it is known in the beginning. There is nothing worse than going through the whole purchase process to find out just before closing that it doesn’t work.

Realtors should also encourage buyers to provide whatever documentation is requested early. The Realtor has a vested interest to make sure everything goes smoothly through closing. Therefore, it is imperative to discuss the importance of this area in the initial buyer meeting.