Mortgage Calculator
Mortgage Articles
Mortgage Glossary
|
| Back to Articles Main Page |
| Preparing Your Finances |
| A crucial
step in starting your search for a new home is having a clear
idea of your financial situation. By getting a handle on your
income, expenses and debts, you'll have a much better idea of
what you can afford and how much you'll need to borrow.
|
| For lenders
to verify this information, though, they're going to need to
look at your financial records. It is also important to remember
that you should include records for each person who will be
an owner of the house. So before you even visit the bank, make
sure you'll be able to provide copies of these important documents: |
| Paycheck Stubs |
| Remember
that lenders are most interested in your average income.
Not only will they want to see this month's paycheck,
but also how much you've been making for the past two
years. Steady employment is also more attractive to lenders,
so if you've been hopping from job to job, be prepared
to discuss the reasons why. |
| Bank Statements |
| In
order to qualify you for a loan, most lenders will also
ask you for copies of your bank statements. Ideally, they'd
like to see a steady history of savings--or at the very
least, that you're not bouncing checks every month. |
| Tax Records |
| It's
always a good idea to save copies of your tax returns,
especially if you're self-employed. If you own your own
business, it's important to note that lenders generally
consider your income as the amount you paid taxes on--not
the gross income of the business. |
| Dividends & Investments |
| Lenders
will usually consider long-term investment dividends,
as well as your investment portfolio, when evaluating
your income. |
| Alimony/Child Support |
| If
you receive steady payments as part of a divorce settlement
or for child support, you can also include this as part
of your gross income. Just remember that lenders will
want to see a copy of your divorce/court settlement verifying
the amount of the payments. |
| Credit Report |
| Virtually
every lender will want to see a copy of your credit report
as part of the loan application process. The report lists
all of your long-term debts, as well as your payment history.
In general, they will require you to pay for the credit
report (approximately $50), but if you have a recent copy,
they may accept that instead. |
