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What Are The Documents Required for Mortgage Approval?

Documents required for mortgage approvalThe process of being approved for a mortgage can be a very long and stressful experience. In order to speed up this approval process, you’ll need to provide the lender with all of the documents required for mortgage approval in advance. Then a little bit of patient is needed while the lender reviews all of the documents required for mortgage approval to make sure you’re able to make your payments on the loan.

Documents Required For Mortgage Approval

As a borrower, you will need an offer to purchase form for the new property that explains the terms and conditions between you and the seller. In most cases, the real estate agent will make sure this document is sent to the lender. Both parties will need to sign this document. The lender wants to know exactly how much money they should lend you. In addition, you’ll need to produce an offer to purchase for existing residence with all conditions removed.

Lenders will normally want to see the feature sheet for the new property too. This is the MLS listing sheet that will include the price, taxes, average cost of utility bills and square footage.

If you have an existing mortgage, you’ll be required to present a recent mortgage statement. The lender will want to know exactly how much is owed on the current mortgage. A void cheque for mortgage payment withdrawal is also required.

In addition, lenders want to make sure you have a steady source of income so the mortgage can be paid. Therefore, you’ll need to be able to provide proof of employment. Lenders typically look for a signed letter from your boss that includes the starting date of employment, position held, income and hourly rate of employment and minimum number of hours worked. This letter needs to be on a company letterhead. Your last two paystubs must also be provided.

Some other documents required for mortgage approval include T4 forms, full tax returns and Notice of Assessment. should also be provided to the lender. Lenders want to make sure that you do not owe any taxes.

If you’re conducting a business transaction, business financial statements are needed before a mortgage can be approved. If purchasing a condo, condo financials are needed.

A lender will also want to make sure that the down payment is made; therefore, you’ll need financial statements or three months of bank statements. Furthermore, closing cost verification is required.

If you’re receiving money from a friend or relative, a signed letter must be given to the lender. Proof of deposit into the account is also needed.

If you’re divorced or separated, you’ll need to provide a fully executed and signed Divorce or Separation Agreement. The lender wants to feel confident that your divorce proceedings are in the past.

Other documents required for mortgage approval include a Copy of Title, Mortgage Protection Plan and Mortgage Commitment. As a borrower, you need to show the lender that your name is on the title of the mortgage. A Mortgage Protection Plan will ensure the lender that the mortgage will be paid in the unfortunate event of the borrower’s death, and the Mortgage Commitment includes the interest rate and other pertinent information.

After you provide all of the necessary documents required for mortgage approval the lenders will process your application. Once you’re approved for your mortgage, the closing will occur and you’ll be the proud owner of your new home!

What do you think? Did we miss any documents in this list? Leave your comment in the box below.