Buying a home for the first time can be one of the most exciting times in a person’s life. However, that excitement is often only attached to the home touring part of the process. Another area of the home buying experience includes the logistical side in terms of the documents you are going to need. Read on to learn about a few of the most important documents that you’ll need in order to have a smooth and successful California home buying experience.
Pay Stubs and Tax Documents
Perhaps the first thing any real estate agent is going to suggest is that you work with a mortgage broker to obtain a home loan. However, before a mortgage lender signs off on a home loan for you, they are going to want proof that you can actually pay back your loan. After all, every loan that mortgage lenders sign off on places not only their bank at risk but themselves as well. Two of the most important documents that an Orange County lender will ask for include a pay stub from at least 30 days ago and tax documents to back up that income. In many cases, two years’ worth of W2s will be asked for by mortgage lenders. They will use this to determine if your income is consistent enough to warrant a long-term home loan.
Asset and Debt Documentation
Although your current income certainly plays a role in obtaining a home loan, another area that a mortgage lender will look into are your assets and debts. This is because even if you have a high income, large amounts of debts can cause you to struggle with mortgage payments. In addition, lenders will use assets as potential collateral if you fail to pay your mortgage for several months.
Yes, you heard that right, reports as in plural. Although lenders will usually only look at the average of all three credit bureaus, it is important to have all three in hand. This is recommended for two reasons. One is to double-check for any credit errors and the second is to have proof of these corrections. The U.S government allows people to request one free copy of their credit report from each of the credit bureaus every 12 months.
When you have these documents ready, your home buying experience in Riverside County should go much more smoothly.