Collect Important Documents Prior to Buying a Home

By: Lee Bell
Submitted: 2008-11-11 11:40:47
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There is nothing quite as thrilling as purchasing a home. For many buyers, it will be the largest investment of your life. Still, there is also no denying that purchasing a home is a nerve-wrecking process because of the amount of time and paperwork that is inherent with a home purchase. Even if you are just starting to look at homes or if you already know what home you want to buy, purchasing a home does require some investigation and effort. Any time that you spend in preparation is well worth the energy because it will help the lending and closing processes go well.

Before you ever contact a mortgage lender, you need to go ahead and get a copy of your credit report. Once you get a copy, double-check it for any errors or possible problems. If you find an error, you need to get in touch with the creditor to make sure that inaccurate items get fixed on your report. If you have a low credit score, it does not mean that you cannot obtain a home loan, but you may have to pay a higher interest rate.

Time Spent Organizing Helps the Process

After you have picked which lender you would like to use as well as the mortgage rates you can expect to get, your lender will request a Verification of Employment form. What you can do is ask your human resources office to keep an eye out for this form. Then you can rest assured that your very important document is not simply sitting around in a stack of mail or on top of a fax machine. If human resources is expecting the document, they are much more likely to complete it quickly.

The other set of records that you will need are your pay stubs. Make sure you give your lender copies and not the originals. You will also need the last two W2 forms that you have received from your employer. Your lender will also certainly need your tax returns from the last two years as well. If you have a co-signer, all of these forms will be needed for that person as well.

Collect Personal Documents to Conclude the Process

Lenders request just a few more items of paperwork to make their mortgage decision. Locate at least three months of your checking and savings account statements and make copies to give to your lender. You will also need to make copies of any asset statements, including those for retirement accounts, stocks, bonds or mutual funds. If your mortgage lender is a local company, bring along your photo identification so the lending agent can make a copy of it for identity verification purposes. If not, send in a copy of it with the other necessary paperwork. If you do not have a license, a passport will suffice.

The last few parts are about getting prepared for the closing and the final stages of mortgage authorization. You will need to make a list of every account that you owe money on. Whether it is a student loan, a car loan, credit card or some type of additional real estate purchase, you need to be ready with the knowledge of how much you owe on each account. Next, make copies of current statements for every account because many lenders will request a copy. You also need to establish how much cash you will have once you have paid your down payment. Make sure to also have a copy of your social security card. After you collect all of these materials, the rest of the process is a snap in comparison.

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