When you apply for a mortgage loan in California, you’ll be asked for a variety of documents relating to your income, assets and debts. Lenders use these documents to verify your financial situation and to underwrite the loan.
The exact list of documents needed for a mortgage loan in California can vary from one lender to the next. Below, we have provided a list of the most commonly requested documents and paperwork used for mortgage underwriting and approval in the state of California.
California Mortgage Loan Documents
This list is not exhaustive. But it does give you a pretty good idea as to which documents you’ll need to round up when applying for a home loan in California.
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- Assets. In addition to the banking documents mentioned above, you might have to submit a list of other assets including mutual funds, IRA / 401k, real estate, etc.
- Bank statements. When you apply for a mortgage loan, your lender will want to know how much money you have in the bank, and how long it has been there. The purpose is to ensure that you have the funds needed to cover your closing costs and down payments, at a minimum. Recent bank statements are one of the most commonly requested mortgage documents in California.
- Credit reports. This is another important mortgage loan document, though it’s not something you’ll provide directly. Mortgage companies typically request credit reports and scores from the credit-reporting bureaus and/or the score provider (such as FICO). This information shows how you have borrowed and repaid money in the past. It also helps the lender verify outstanding loans and other debts.
- Debts. Lenders want to ensure that you’re not taking on too much debt, with the addition of a home loan. One of the ways they do this is by analyzing your recurring debts in relation to your income. So you may have to provide a list of your current debts, such as credit cards, personal or student loans, car loan, etc.
- Gift letters. If you receive money from a friend, family member, employer or other approved donor to help cover your down payment, you’ll need to obtain a gift letter from the donor. This is another standard mortgage document in California. Learn more about gifts.
- Pay stubs. These are used to verify your employment status as well as your current earnings. Typically, the two most recent pay stubs are requested, or enough to cover a 30-day period. But this can vary.
- Purchase agreement. Once you’ve signed a purchase agreement / contract with the seller, you’ll need to provide a copy of the document to your lender. You won’t have this mortgage document when you get pre-approved for a loan. But you’ll need to submit it before the loan can actually close.
- Residences. Lenders often request to see a list of residential addresses for the last two years, or more.
- Self-employment. California home buyers who are self-employed may have to provide additional documents for mortgage underwriting and approval. For example, a profit-and-loss (P&L) statement might be requested. See: bank statement loans.
- Tax returns. Lenders typically want to see tax returns for the last couple of years. These documents are used to verify income, which is an important part of the mortgage underwriting and approval process.
- W-2 statements. This is another commonly requested mortgage document in California. You can expect to provide w-2 statements for the last two years. As with tax returns, these documents are used for income verification purposes.
Notes: Some of the items on this list might not apply to your situation. Additionally, you might be asked for additional mortgage documents that are not on this list. Documentation requirements vary based on the type of home loan being used, the borrower’s financial situation, and other factors. This article is meant to give you an overview of commonly requested mortgage documents in California.