Home buyers in New Jersey tend to have a lot of questions about the mortgage application, processing and closing process. In particular, many buyers want to know about the mortgage documents that are needed in New Jersey.
The list of required documents can vary based on the type of home loan you are using and other factors. With that being said, there are certain mortgage documents that are required for most home-buying scenarios. They are explained below.
Mortgage Application and Closing Documents in New Jersey
When you apply for a mortgage loan in New Jersey, you will be asked for a variety of documents relating to your finances. Here are some of the “usual items” that are required during the mortgage application, underwriting, and closing process in New Jersey.
- Bank statements for the last few months, for accounts the borrower holds. If more than one person will be named on the mortgage loan, they will each have to provide banking documents.
- Tax returns for the last year or two. These documents can be sent straight to the mortgage company from the IRS. The home buyer typically completes IRS form 4506-T (Request for Transcript of Tax Return), which enables this to happen.
- Recent pay stubs showing year-to-date earnings.
- Name and contact information for the borrower’s employer, and possibly previous employers as well.
- Most recent statements for any outstanding loans or lines of credit.
- When applicable: marriage licenses, child support documentation, divorce settlements, bankruptcies or judgments.
- In some cases, New Jersey mortgage applicants are asked for explanations of recent credit inquiries.
- Gift letters. If you obtain gift money from a third party, like a family member or close friend, you will have to obtain a letter from the donor stating that they do not expect any kind of repayment.
These are some of the most commonly requested mortgage and closing documents in New Jersey. You might have to provide additional documents, depending on the specific circumstances of your real estate transaction and loan.
For example, home buyers in New Jersey using an FHA loan have to sign a few extra documents that are required by the Department of Housing and Urban Development.
If you are ready to start the mortgage application process, we can give you a complete list of the required documents. Please contact our staff with any financing-related questions you have.
In-Depth: Letters of Explanation
We mentioned letters of explanation in the list of New Jersey mortgage and closing documents above. Here’s some more information on that topic.
When your home loan enters the underwriting stage, the underwriter might request some additional documents from you. Letters of explanation are a common requested during this stage of the process.
This is where the underwriter, or underwriting department, needs additional clarification regarding something of a financial nature. For example, an underwriter might want an explanation for a large deposit or withdrawal from the borrower’s bank account.
In most cases, these letters are simple matter. As a borrower, the best thing you can do is produce the requested information in a timely fashion, so it does not delay the underwriting or closing process.
Questions? This article provides a basic overview of some of the most commonly requested mortgage and closing documents in New Jersey. Your documentation requirements could vary based on a number of factors, including the type of home loan you use. Please contact us with any mortgage-related questions you have, or if you would like to start the home loan application process.