What information is required for mortgage pre approval?

[Vamshi Ananth]

Hello Fellow BPers,

This might be a basic question, for pre approval of a mortgage, does the mortgage broker need the following information?

Last 2 years federal tax returns all pages and W-2s
Last 2 paystubs covering 30 days

Last 2 months bank statements all pages for each account listed on application.
Copy of Drivers Lic and SS card.

Is providing a SSN card to the mortgage broker a common practice for per-approval?

[Chris Mason]

Hi @Vamshi Ananth, that's actually not a very thorough list of paperwork. You aren't truly ready to house hunt in the Bay Area with just that minimal paperwork reviewed. Someone is being a slacker, that's a Nebraska or Oklahoma list where they close escrow in 2-4 months, not a Bay Area list where we close in 18-30 days typically.

Credit:

• Photo ID.
• 2 year employment history, company, position, and HR/payroll person name/phone/email.
• 2 year residential history, landlord names/phones/emails. 
• 12 months of proof you paid rent on time (search your bank account for "$2300" if your rent is $2300).

Income:

• Most recent month of paystubs.
• 2 years of W2/1099s.
• 2 years of personal tax returns. Your SSN is on these, so I don't need social security card.
• 2 years of tax returns for any business you have >25% ownership interest in. I'll do the YTD P&L, so that isn't needed.
• 2 years of K1s for any business you have <25% ownership interest in.
• Conservative estimate for gross rents from subject property. This can be provided immediately prior to you writing an offer, if rental income is needed to qualify.
• Most recent mortgage statement, homeowner's insurance declaration page, and if applicable leases, for all real estate owned. I can pull the prop tax bills, so that isn't needed.

Assets:

• 2 months bank statements, all accounts, including retirement accounts. 
• Sources of all non-paystub deposits greater than 25% of gross monthly earnings documented, explained, and reviewed. 

That is approximately the bare minimum required to do anything more than be a looky-loo or tire-kicker at weekend open houses. No one in the Bay Area is ready to talk to a real estate agent or ask for a non-weekend-open-house home showing until all of that has been thoroughly reviewed or until you have the full purchase price of the home you wish to purchase liquid and available without needing to borrow money.

Earnest money deposits in our area are typically for tens of thousands of dollars. You don't want to expose that to risk because it was "too much work" to email a PDF.

We do not "submit for underwriting consideration and review to maybe give you a mortgage" in the Bay Area. We submit for confirmation of loan approval and pending funding once the appraisal is back confirming value. The only thing a LO or mortgage broker in the Bay Area should be asking you for once you go into contract is updated paystubs and bank statements, to confirm you haven't received a paycut or spent the money on partying.