Make things easier when you’re shopping for a mortgage by having all the mortgage documents you need for pre-approval and qualifying for a mortgage ready to go.
As an experienced Realtor® in Edmonton, Wally’s learned a thing or two about mortgage lenders and the mortgage approval process. He’s also worked with some of the best mortgage brokers in the business who have helped homebuyers navigate the buying process and helped bring their Edmonton real estate dreams to fruition.
Here’s an overview of some of the mortgage documents you need to provide your bank or mortgage company to get approved for a mortgage.
Mortgage documents checklist
The minimum amount you’ll need for your down payment is based on the purchase price of the home you want to buy. Generally speaking, the minimum down payment for a home priced at $500,000 or less is 5%. For homes between $500,000 - $999,999, it’s 5% on the first $500,000 and 10% on the remaining purchase price. For homes $1 million or more, you’ll need to put down 20% of the purchase price.
Typically, the minimum down payment must come from your own funds. Lenders usually ask that any amounts that come from other sources, such as a family member, are accompanied by a gift letter that clearly states the amount has been gifted and does not need to be paid back. Other down-payment mortgage documents include:
- Copy of the sale agreement for the sale of your current/previous property
- Withdrawal from an RRSP through the Home Buyer’s Plan (if applicable)
- Savings or investment statements current within the last 90 days
- Gift letter
Income & Employment Verification
In addition to reviewing your credit report, a mortgage lender will also require proof of your income and employment before you can qualify for a mortgage.
Different lenders may accept different types of documents for this, but most will accept the following:
- Your two most recent pay stubs or T4s
- Notice of Assessment for the last two tax filing years
- An employment letter from your employer that includes your position, length of service, and salary
- If you’re self-employed, a lender may ask for incorporation documents (if applicable), and business financial statements for the past 2-3 years. When submitting your Notice of Assessment, you may need to submit both your personal one as well as your corporation’s. Additional documents may also be reviewed including your general ledger or profit & loss statements.
- Proof of any other sources of income including pension, rental income, or part-time work.
- List of assets including other properties. If you already own a property, you’ll want to bring a current mortgage statement and both the current and previous year’s property tax statement.
Liabilities & Debts
Your lender will request a credit report, but it’s good to bring a list of your debts so that you can review the report together to provide the most accurate reflection of your current debt load. Your list of debts may include:
- Credit card balances
- Student loans
- Any leases or lease-to-own agreements
- Car loans
- Personal loans
Purchase listing details and property information
The final mortgage approval process won’t be completed until you find your perfect piece of Edmonton real estate. The mortgage approval process is a combined assessment of you as the borrower and the property itself. Some of the mortgage documents you’ll need for the property details may include:
- A copy of the purchase agreement
- A copy of the MLS® listing
- The condo corporation’s financial statement and status certificates
- A copy of the well/septic tank certificate for a rural property that doesn’t access municipal water or sewage lines
Making the mortgage approval process as smooth as possible is critical for ensuring the home purchase goes off without a hitch. Having all your ducks in a row — and your mortgage documents ready to go — is a great way to keep things on track so you can keep stress levels in check and celebrate your new home purchase.
Need a referral for a great mortgage broker in Edmonton? Give Wally a call/text at 780.238.7384 or send him a message.