Our top brokers tell us that one of the most important things, when discussing the home financing process with potential borrowers, is identifying upfront the documentation that will be required from them.
JMAC’s brokers tell their clients that the most common documents to be provided in order to obtain a home loan include W-2 forms from their employer for one or two years, pay stubs to cover a month of employment, and at least the last two months bank statements. Our brokers also tell borrowers that any large or unusual deposits will need be sourced and verified.
Other important items include tax returns and self-employed borrowers, or borrowers who have a side business or own a rental property will need at least two years of both personal and business tax returns. A passport or driver’s license will also need to be provided, as well as proof of legal U.S. residency if their borrower is not an American citizen. For military borrowers wishing to obtain financing from the VA, they will need their DD 214 form and Certificate or Release or Discharge from Active Duty.
Every month JMAC sees that many first time homebuyers also receive gift funds to help them purchase a home, which will need to be documented as a gift letter to include information about the donor’s relationship to the borrower, the amount of the gift, the date and the purpose. The donor may also need to prove that he or she can afford the gift through bank statements.
If one of our brokers’ borrowers is going to use alimony or child support as part of their funds to qualify for a home loan, they will need their divorce settlement, proof that their ex is paying regularly and verification that the payments will continue. For first time homebuyers, they will need to show proof they’ve paid rent on time as well.