Purchasing a home can be more than a little overwhelming. Our ultimate home loan checklist will make the task much easier by ensuring that you are aware of what you need to know before, during, and after you sign your mortgage.
Before: What documents you will need
You can expedite the loan process by being up front and ready with the most basic documents that your bank will most likely require.
- Two forms of identification, such as driver’s license, Social Security Card, or passport.
- Proof of income, including:
- * Copies of your two most recent paycheck stubs
- * Copies of your W-2s for the past two years
- * Copies of your federal tax returns for the past two years.
- Proof of assets, including:
- * Bank statements for the past 60 days, for each of your accounts
- * Copies of all of your current retirement or investment accounts
- * Documentation for any other sources of income or debt
- Additional documents, including:
- * If self-employed, two years of business tax returns and 1099s
- * Documentation showing divorce or bankruptcy
- Explanatory letters to clarify any questions your bank might have regarding matters like unusual deposits to your bank account or recent inquires on your credit report
During: Questions to ask
Asking the right questions during the home loan process can ensure that you collect all of the information you need.
- What is the interest rate?
- Is this a fixed or variable mortgage?
- If the mortgage is variable, when will the rate change and how is that determined?
- For how long are quoted interest rates valid?
- How much money is needed for a down payment?
- Is there a penalty for early pay-off?
- What are the closing costs?
- Are there any additional fees or costs?
- When is the expected closing date?
- Are there any actions that should be avoided prior to the closing date, such as employment changes?
After: Closing your home loan
The final step in the loan process is the closing, where you will settle the finical details and sign all of the documents necessary to complete your loan and the purchase of your new home. You will need to bring the following items with you:
- Your homeowner’s insurance policy
- A check to cover closing costs
Once you have handed the check over and signed the many documents, you will be ready to take possession of your new home on the agreed upon date.
Purchasing a new home can be both an exciting and nerve-wracking endeavor. Enjoy the process a little more and worry a little less by following this checklist.