Mortgage Basics: First Things First!

It is a rare occurence if I am not conducting a public open house on Sundays, be it for my listings or a colleague’s. I have to say that I am always amazed by how many buyers are out there looking for a home and have not yet gone through the process of being pre-approved by a lender. This goes for first time buyers, as well as those upgrading to a larger home. In New Jersey, it has become a best practice for Realtors to submit an offer on a home with a pre-approval attached. Without an official pre-approval from a lender, offers are simply not taken seriously. Furthermore, if you find the house of your dreams and happen to be involved in a multiple-bids situation, you will be hurting your chances of being in the running.

So, my advice is when you decide to start looking for a new home, make speaking to lender the first thing on your Home Buying To Do List. I encourage all my clients to speak to at least three lenders to compare rates.  Having the necessary information ready BEFORE you make the call will make the mortgage application process easier and faster. Below you will find a preliminary check list of paperwork you should start looking for:

General

• Social Security numbers
• Employment verifications
• Two most recent paycheck stubs
• Tax returns for the last two years
• Three most recent bank statements
• Divorce papers
• Green cards for resident aliens

Assets

• Saving accounts (balances, account numbers, and institutions)
• Credit union (balances, account numbers, and institutions)
• Mutual funds (balances, account numbers, and institutions)
• IRAs or 401(k)s (balances, account numbers, and institutions)
• Equity in current home
• Cash flows from rental properties
• Pensions or annuities
• Alimony
• Life insurance—the face amount and cash value

Debts

• Mortgage and home equity loans
• Monthly bills
• Credit card balances
• Student loans
• Car loans
• Alimony and child support payments

I'm happy to provide names of lenders that have worked with my clients, just email me for the list at caroline.gosselin@cbmoves.com.