Austin Texas Real Estate: Do not buy the cart before the horse which is a common mistake with Buyers. The first step in finding your new home is knowing the big picture of your financial situation. Getting a feel of your income, debts, and expenses you will have a better idea of how much to borrow and what you can afford.
Institutions need this information so they are going to look at your home records. Plus you should include financials for every person involved in the purchase of the house. Below are some documents that need to be prepared for the lender:
Bank Statements: Lenders will need copies of your bank statements. They need proof of money that you putting down unless it is a gift. Bank statements are need for all parties especially if you are married.
Paycheck Stubs: Banks are interested in your average income. They want to see your monthly paycheck but how much you have earned in the last two to three years. Regular employment is also more important to lenders so have good reason if you have moved around on multiple jobs.
Tax Records: Always keep the last five years of income tax records for lenders and in case you are audited. What is important about tax records is that lenders can get an exact idea of your income to your expenses. This falls into your debt ratio which is an important formula for loan approval.
Credit Report: Every financial institution will need to see your credit report for the loan application process. It lists all of your debts your history on how timely you are with payments. The credit report and application are very important part of the process.
Dividends and Investments: Lenders will consider your investment portfolio and long investment dividends are very helpful when other items above are not as good when evaluating your income.
Alimony and Child Support: Payments for child support or divorce settlement are included income. Lenders will want to see a copy of your divorce settlement as proof of payments payments.
