Top 5 Documents You Need for a Smooth Mortgage Approval

Applying for a mortgage can feel like a juggling act with all the paperwork involved. I totally get it—it’s a lot to handle! But don’t worry, I’m here to make it easier. Having the right documents ready from the start can speed up the approval process and help you avoid any last-minute stress. Here are the top five documents you’ll need to keep things moving smoothly.

1. Proof of Income

Lenders need to know you have a steady income to cover your mortgage payments. If you’re employed, this will usually be straightforward. If you’re self-employed, it might take a little more documentation, but it’s still totally doable!

What You’ll Need:

• Salaried Employees: Your two most recent pay stubs and a letter from your employer confirming your position, salary, and how long you’ve been with the company.

• Self-Employed: At least two years of tax returns, Notice of Assessments (NOA), and possibly bank statements or contracts to verify your income. The more consistent your income looks, the better.

Action Step:

• Start by gathering your pay stubs and employment letters if you’re salaried. If self-employed, begin compiling tax returns and any other proof of income you can provide. The earlier you start organizing these, the less rushed you'll feel during the process.

2. Proof of Down Payment

Lenders want to know where your down payment is coming from. Whether it’s from savings, investments, or a gift from a family member, you’ll need to show proof.

What You’ll Need:

• Bank Statements: Provide statements from your savings or investment accounts showing the funds. Most lenders require at least three months of statements.

• Gift Letter: If a family member is helping you with the down payment, you’ll need a gift letter confirming the money is a gift and not a loan that needs to be repaid.

Action Step:

• Print or download your bank statements that show where your down payment is coming from. If you're getting help from a family member, request a gift letter from them early so you’re not scrambling later.

3. Credit Report

Lenders will look at your credit score and history to see how responsible you’ve been with paying back debts. This helps them determine if you’re a safe bet for a mortgage.

What You’ll Need:

• Most lenders will pull your credit report themselves, but it’s always good to know your score beforehand. You can get a free copy of your credit report from Equifax or TransUnion.

• If there are any mistakes on your report, be sure to dispute them before applying to avoid any issues.

Action Step:

• Request a copy of your credit report ahead of time and review it for any inaccuracies. If your score is lower than you'd like, start working on improving it (check out my previous blog for tips on boosting your credit score).

4. Employment Verification

Even with proof of income, lenders may want further confirmation that your job is secure. This is especially common if you’ve recently changed jobs or work in a high-turnover industry.

What You’ll Need:

• A letter from your employer verifying your position, salary, and that you’re a full-time employee. If you’ve been with the company for less than two years, they might also ask for previous employment information.

Action Step:

• Reach out to your HR department for a letter of employment. Make sure it includes your role, salary, and how long you’ve been with the company. Getting this early will help avoid delays.

5. Government-Issued ID

Finally, lenders need to confirm your identity to ensure everything matches up with your application. This part is usually pretty simple, but it’s easy to forget!

What You’ll Need:

• A valid government-issued ID like a driver’s license, passport, or permanent resident card.

Action Step:

• Double-check that your ID is up to date and not expired. Keep it handy when you’re meeting with your lender or mortgage broker.

Final Thoughts: Organization is Key

I know gathering all these documents can feel like a lot, but getting organized from the start will make the whole mortgage process so much smoother. You’ll be prepared, your lender will appreciate it, and you’ll be one step closer to owning your dream home. And remember, I’m always here to help if you have any questions or need guidance along the way!