Here is a checklist to help you apply for a mortgage in Philadelphia, Pennsylvania
Starting your journey to apply for a mortgage in Philadelphia, Pennsylvania? Here’s what all you should keep ready-
Apart from knowing the type of loan you want to apply for, like USDA loan or VA loan, there is something more that you would require.
Documents proving your income and debts will be required by Mortgage Lenders in Pennsylvania when you apply for a mortgage. Depending on your situation, you may need specific forms. Those who are self-employed, for instance, will have to provide different forms than those who are employed by an organization.
You can give your lender a good idea of your approval odds by providing them with recent pay stubs, bank statements, W-2 forms, and tax returns.
Mortgage Brokers in Philadelphia would be able to assess the borrower’s creditworthiness based on these documents. Even lenders can tell (borrowers) what they can and cannot do with absolute certainty using these documents.
Below are seven documents that you might need to apply for a home loan, depending on your financial situation.
1. Tax returns
For mortgage lenders in Pennsylvania, financial information is crucial. The best lender will probably need to see your tax returns, so you’ll have to sign Form 4506-T, which authorizes the IRS to request a copy.
Tax returns from one to two years are usually required by lenders. It is important that your reported earnings on pay stubs are consistent with your annual income in order to avoid huge fluctuations.
2. Proof of income
Most lenders and Mortgage Brokers in Philadelphia will ask to see your pay stubs from the past month or two. Pay stubs help them gauge your current earnings and give them an overview of your financial health. You may need to provide your lender with proof of income (such as 1099 forms, direct deposits, etc.) if you are self-employed or have other sources of income (such as child support).
3. Asset and bank account statements
Your bank statements and other assets may be taken into account when mortgage lenders in Pennsylvania assess your risk profile. Investing assets can be included as well as insurance, such as life insurance.
In case of an emergency, Lenders and Mortgage lenders in Philadelphia usually request these documents to ensure that you have a few months’ worth of reserve mortgage payments in your account. You must also show that your down payment has been in your account for at least a few months and hasn’t just appeared overnight.
4. A history of credit transactions
In order to assess whether you are a reliable borrower, lenders will often pull your credit report with your permission.
If your credit report contains any blemishes, you may need to explain them. Foreclosures and short sales are examples of blemishes.
It is important that you are prepared to explain any negative items found on your credit report. Lenders can then assess your risk level. Unavoidable circumstances may be viewed differently by lenders than habitual delinquencies.
5. Letters of gratitude
Buying a house with the help of your friends and family may be possible. In that case, you must provide written confirmation the money was a gift and not a loan. You should include the recipient’s relationship to you as well as the value of the gift in the documentation.
6. Photo ID
Your photo ID, such as your driver’s license, is likely to be required. Basically, it’s just to prove you are who you claim to be.
7. History of rentals
Buyers who don’t own a home usually need proof of their ability to pay their mortgage. If your landlord cashed the checks, you may need to provide cancelled rent checks from the past year. If you did not pay your rent on time, your landlord might ask for proof. In case you lack a lengthy credit history, consideration should be given to your rental history.
Have more questions? We can help you. Apart from helping you get the right mortgage product and making the process as it can be, we offer you every possible assistance so that you can easily get approved for a mortgage. We are the most trusted mortgage provider in Philadelphia, Pennsylvania.