Of all of the first-time homebuyer tips out there today, easily one of the best is to properly document your assets as a buyer trying to qualify for a mortgage loan. Keeping track and making sure all assets are properly documented should in fact be among the more important items on that first-time homebuyer checklist.
The reason is simple. In addition to all of the other things, a first-time homebuyer MUST prove their worth when attempting to qualify for a mortgage loan. It only makes sense that a lender will need to know a homebuyer’s net worth in order to prove whether they are credit worthy or not.
Putting together a complete picture of your assets will undoubtedly take time and effort. A good first time homebuyer tip is to take it one step at a time – ensuring each asset is documented and included within your loan application.
A good way to start this process is to begin with all of your bank accounts – checking, savings and money market accounts. You will need documentation that shows the name and address of your banking institution, not to mention the names on each account, account number and balances.
(Tip: A banking statement, whether from online or straight from the bank, should suffice)
Other assets that should be accounted for include: stocks, bonds, CDs, mutual funds and any other investments. The Home Loan Learning Center recommends a first-time homebuyer keep a record of dividends and interest received from any investment, such as the 1099s provided for tax filing.
The next group of assets to tackle is any retirement accounts — such as IRAs, Simplified Employee Pension Individual Retirement Arrangements or SEP-IRAs, 401ks, etc. This is also likely a good time to document any and all information related to your life insurance
(Tip: Use the MOST RECENT statements when submitting them as part of your loan application)
Be sure to document all information pertaining to vehicles you own, such as make, model and year. Also include information on all of the real estate you own, such as the address and market value. You will also be required to provide details of your mortgage, such as proof of monthly payments, a profit-and-loss statement for any and all investment properties
Lastly, it’s a good idea to include documentation of anything you have of significant value – such as jewelry, art, boats, antiques and furniture.
While documenting your assets is key, there are many other forms and documents a first-time homebuyer must have when attempting to qualify for a mortgage loan. The Blue Water Mortgage family prides itself on educating first-time home buyers on what to know throughout the home buying process – whether it is tips on how to repair credit or reasons to rent rather than own.
Contact a broker today to learn more about what it takes to qualify for a home mortgage loan.