List of Required Documents

Many mortgage lenders provide you with an incredibly lengthy list of documents that they require with mortgage applications.

Most of the items on this laundry list are required in order to prove and substantiate your current financial status to the mortgage lender and, subsequently, to other organizations that may buy your loan in the future. Pay stubs, tax returns, and bank and investment-account statements help to document your income and assets. Lenders assess the risk of lending you money and determine how much they can lend you based upon these items.

Falsifying loan documents is committing perjury and fraud and is not in your best interests. Besides the obvious legal objections, you can end up with more mortgage debt than you can really afford.

Permissions to inspect your finances

In order for a mortgage lender to make a proper assessment of your current financial situation, the lender needs to request detailed documentation. Thus, mortgage lenders or brokers ask you to sign a form authorizing and permitting them to make such requests of your employer, the financial institutions that you do business with, and so on.

You should get, in writing, before you agree to do business with a lender, the lender's estimate of what your out-of-pocket expenditures will be in order to close on your home loan. The good news for you is that lenders are required by law to provide, within three days of your application, what's called a Good Faith Estimate of closing costs after you've initiated a mortgage with them.

The Uniform Residential Loan Application

Many lenders use this standardized document, known in the mortgage trade as Form 1003, because they sell their mortgages to investors. When mortgage loans are resold, governmental organizations called Fannie Mae and Freddie Mac agree to guarantee the repayment of principal and interest, which makes it easier for lenders to sell the loans and more desirable for investors to buy them.

If you let someone fill out the Uniform Residential Loan Application for you, be sure that the information on the form is accurate and truthful. Ultimately, you're responsible.