What documents do you need when applying for a mortgage?

Applying for a loan is a huge step, and it’s not always straightforward.

Before you meet with your finance broker, make sure that you have the following documents on hand to prove your identity, income, asset, and liabilities.

1. Identity You will need two of the following three:

passport;
driver’s license; and
photo identification, such as a student ID card

If you don’t have two of these, you can also provide one, plus a birth certificate, Medicare card, citizenship certificate or similar documentation.

2. Income If you are a full-time employee, you need to prove your income by providing the two most recent PAYG payslip, including YTD income. If your payslip doesn’t show YTD figure, you will need to provide other extra documents such as your employment contract, an ATO tax assessment, a PAYG summary or a professionally prepared tax return.

If you are self-employed, beside of providing your individual tax return and ATO assessment notices for a year. You also need to provide your business’s financial documents, such as the most recent two years company tax returns and most recent two years company Balance sheets and Profit and Loss statements. You maybe need four quarterly BAS statements or other documents from your accountant too.

Any other incomes that you receive will also need to be documented.

Property rental income - the rental income statement from agency need to provide.
Shares – A statement from stockbroker firm, investment record or tax return.
Government benefits such as family tax benefit, bring a statement from Centrelink.

3. Assets You will need to prove your savings with bank statements, as well as any other assets such as cars, stock, term deposits, and property.

4. Liabilities The way that lenders assess your ability to make repayments is based on your current total credit limit, for example, your credit card limit, mortgage and car finance. For your finance broker to improve your borrowing capacity, you should either reduce your debts and your credit cards limit. You will need current statements for your credit cards, store cards and any others.

Are you planning to refinance your current mortgage? If you are looking to refinance a current mortgage, you will need the past six months’ loan statements and the current payout figure, including any exit fees.

Of course, depending on your circumstances and the requirements of your lender, the documentation you need will vary slightly different. Speak to Kevin on 0415820016, and he can tell you exactly what to provide and take the confusion out of applying for a home loan.

Disclaimer: We recommend that you seek independent financial and taxation advice before acting on any information in this newsletter. It contains general information only and has been prepared without considering your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances. Your full financial situation will need to be reviewed prior to acceptance of any offer or product. Interest rates are subject to change without notice. Lenders terms, conditions, fees & charges apply.