As a potential homebuyer, there are several documents you’ll need to provide a lender to ensure the process of purchasing your dream home goes as smoothly as possible. In virtually all cases, sellers won’t consider buyers who don’t have a mortgage pre-approval simply because homes for sale in Napa commonly get multiple offers from pre-approved buyers. With that in mind, we’ve laid out the five most crucial documents you should have ready so you can take your seat at the bargaining table with your mortgage pre-approval in hand.
Proof of Income
Lenders will typically ask to see a buyer’s W2 income statements from the previous two years. They will also ask for up-to-date pay stubs and year-to-date income. It’s important to include other sources of revenue that may come in the form of alimony or bonuses. Finally, you’ll be required to submit your tax returns for the past two years.
Proof of Assets
As a buyer looking to purchase Napa real estate, you will need to show a lender you have the capital for the down payment and closing fees, and still have enough money left over in reserves. This will require you to provide your bank and investment account statements.
This is the big one. Having a pristine credit record will not only improve your chances of pre-approval but can also impact the interest rate attached to your mortgage. Most lenders will need to see a minimum 620 FICO score to give you the thumbs up for a conventional loan. This may also be required if you’re applying for a Federal Housing Administration loan. If your credit score is upwards of 760, you’ll be pleased to know that lending institutions tend to offer more attractive interest rates.
Letter of Employment
Proof of stable employment will also be required by lenders for pre-approval. This means you’ll be asked to provide a letter of employment from your company, with contact information so the lender can verify your position and salary. If you’ve changed jobs recently, the lender may ask for your previous employer’s contact as well. Self-employed buyers will have to go the extra mile and provide extra paperwork and proof of income to leave no doubt that their business is stable and generates adequate revenue.
Lastly, lenders will ask for a copy of your identification such as your driver’s license and social security number. This will allow them to perform their own credit check and verify other important information.
Being prepared with a lender is key to making sure your home-buying process is seamless. If you’re ready to take a look at some homes for sale in Napa with the help of professionals who have worked in this market for over 20 years, contact Adam Ghisletta today!