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Loan application

We take care of our finances because credit scores and credit history are two of the most important things in our life especially here in the United States. Almost anything from as simple as opening a credit card, getting a car loan until purchasing a home requires us to get a loan; unless you are one of the few good and rich men who can purchase everything in cash. (We wished, right?)

Most documents you need are the same but the more you borrow, the more documents you need to prove that you are trustworthy. The more money you borrow, the higher the credit scores require by lenders. It just makes sense. Buying a home is a major purchase in life. That’s why you have to work on it for at least two years but even more than that to get a good credit score and history to be qualified for a home loan. When I talk to a potential buyer; the first thing I will assist them is to be qualified for a loan. I don’t do it after we look for homes. Qualifying for a loan with a certain $$$ amount is much better than looking for a home first then start qualifying for a loan. What if you are not ready? I looked at it as clearing the path first so everything will go on smoothly instead of a bumpy ride not knowing if you will get a house or not. There are some potential home buyers who insisted their credit is good and no need for a pre-qualification as for sure they will get a loan. It does not work that way. I am saving you time and frustrations just in case. But if they declined, I politely refuse to assist as serious homebuyers will be more than happy to go with the process.

Below are the documents lenders asked to be qualified for a home loan; be prepared so you will be on a head start and know what to expect along the process.

W2 forms from past 2 years

Pay stubs from 1-3 months

Tax Returns for last 2 years

If you are self-employed and do not have pay stubs and W2 forms; the following are required:

Business and Personal Tax Returns for the last 2 years

Year to date Balance or Financial Sheet – Depends on what lenders find out on your credit scores and history; this usually pre-approved you for a loan and how much. They usually require the following in case your financial status is in between so they can see if you have other financial statements that they may use in order to qualify for a loan:

Additional Assets as to: Social Security Income; 401K, IRA and other Stock Bonds

You may be asked for the following documents in clarification on what is on your credit history:

Credit Cards; Student Loans; Car Loans; Child Support and Alimony; Divorce Decree

This is not as complicated as it may seem. You only need the first three items most of the time but depending how complicated your finances are, they may require additional documents for support. Most documents nowadays can just be pulled online so you can get it in a breeze. Be patient with your loan officers as they were trying to get you a loan and making sure you get the best rate. I get feedbacks from other clients that why previous loan officer did not ask those documents from them or from their friends. Each individual has different financing challenges. Rule of thumb; you cannot compare. I’d rather have a loan officer that asked me a lot of documents because I know for sure they were clearing all potential hazards along the way before making a commitment on the loan. Think of it as they are making all possible way for you to get a house you’ve been dreaming of.

In case you are not ready at this time or there are some clouds on your credit; they should be able to refer you to credit repair companies that does it for you. Some issues you can do it yourself and before you know it, you are ready to go. I have clients that I monitor until they are ready to buy. It may take months or years but it’s all worth it.

Note: Jocelyn Porteria is a Realtor® licensed in VA. Top Producer of Fairfax Realty and earning Five-Star Reviews on ZILLOW from her clients. She is a Certified Expert Negotiator and also earned a designation as an Accredited Staging Professional; ABR, Accredited Buyer’s Specialist; CDPE Certified Distressed Property and Short Sale Expert, for more info, visit her website at www.jprealdeal.com and on Facebook https://www.facebook.com/realdealconsulting. Call her at 571-432-8335 or email at realdealconsulting@yahoo.com for free confidential consultations.

 

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