If you’re planning to buy a home, it’s a good idea to get pre-approved for a mortgage before you even start looking at houses. This will tell you what you can afford and let sellers know your offers are serious. But applying for a mortgage can be intimidating if you don’t know what to expect. Be prepared for what information is required on your mortgage application and why that information is important to your lender. If you need more information, don’t hesitate to call a VCB Mortgage loan specialist at
(703) 961-0160 (Option 0).

Pre-Application Considerations:

• Most importantly, be honest about everything on your application.
• If you will be borrowing your down payment from a relative, do so more than six months before you apply for your home loan because lenders will typically not allow you to borrow your down payment. Some lenders will accept this situation if your relative provides a statement that the money is a gift without repayment obligations.
• Request a copy of your credit report to review for mistakes. Attempt to correct any errors before you submit your application. You can send a letter with documented proof to the credit bureau requesting a correction of the mistake. Order your free credit report each year from the three major credit bureaus, or call 1-877-322-8228. You can also write: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
• Catch up on all bills and continue to pay all your bills on time. Late payments can hurt your credit and your ability to get approved for a loan.
• If you have many debts, consider consolidating these loans since too many debts can cause lenders to question whether you will be able to handle additional payments.

Mortgage Application Considerations:
You’ll need to bring certain documents with you when completing your mortgage application, including:

• A copy of the purchase sales contract.
• A legal description of the property.
• Your tax returns for the previous two years, including all schedules if you are self employed, employed in a family business or receiving part of your income from commissions or own rental property.

You’ll also typically need the following information:

• Your employment history for the last two years.
• Bank account information including account numbers and balances.
• Stocks, bonds and investment account information.
• The value of your retirement plan with a recent statement and supporting documents.
• Automobile information.
• Life insurance policies including the name of the insurance carrier, policy number, and amount of insurance.

By preparing ahead of time for the loan application process and by getting pre-approved for a mortgage, the buying process can go a lot more smoothly for you, and you’ll soon be enjoying a new place to call home.