What documents do you need for a home loan application?

A home buying process may surely feel like a roller coaster ride. The whole process gives a similar feeling of excitement and fear, the excitement of finally touching your dream and fear of missing out on something and making any expensive mistake. Between fishing and finalising your home, there’s a lot more in terms of process and paperwork which can evoke  feelings of headaches. The whole journey involves several steps and with each elevating step, the difficulty and anxiety may increase, specifically if you’re a first home buyer. This is why we recommend not to go the road alone on this journey. Now the question is, who can be your best companion? In our opinion, it should be someone who can guide you throughout the process, possess intellectual, factual knowledge and can solve your queries; you can certainly find all these qualities in a mortgage broker. So why don’t consider their assistance?

Once you’ve zeroed down your budget and ruminate your wallet you’ll probably get an idea of how much mortgage you’ll require. But the process of getting a mortgage like walking on an eggshell. After finding the mortgage loan which meets your needs, the endless battle with paperwork begins. Yes! The home loan application involves a lot of documentation because mortgage lenders have an obligation to lend responsibly. They need to ascertain that you can afford to pay back the loan amount based on your current financial situation. To ensure from their end they need to gather information about income and expenses. That’s why you need to show the evidence with the right document.

So here is a list of what your lender may ask you to provide.

Identify proof

Be it any country this legal requirement is common & essential in all. Your lender requires your id proof to verify that you’re who you claim to be. So, you must provide them with at least one primary identification proof of two secondary documents. Which can be any of the following:

Primary document

• Australian driver’s licence
• Current passport
• Photo IDs such as Australian tertiary institution ID card, Proof of Age, or Waterways/Boat License

Secondary documents

• Australian birth certificate
• Medicare Card
• Credit Card
• Health Care Card
• Australian Citizenship certificate
• Ato assessment notice ( less than a year old)

Your Income details

Your lender requires your current income details to evaluate if you qualify to pay back the mortgage or not and if you do then how much you can repay each month. So, may ask for:

Salary

• Copy of your two recent payslips
• Bank account statements showing at least three months’ salary credits
• Tax Return and ATO notice of Assessment ( less than 18months old)
• An employment contract

If you’re Self-employed

• Personal and business tax returns
• ATO Notice of assessment

Government income

• A bank account statement showing payment credits
• A letter from Centrelink summarizing your payments

Your financial circumstances

Your lender will look at your overall financial circumstances while processing your mortgage application to know if you own any assets and whether you’ve any other liabilities such as:

Assets

• Shares
• Automobile
• Superannuation
• Bank account details with proof of savings
• Current term deposit account

Liabilities or debts

• Credit card limit
• Other loans like personal and car
• Every day expenses such as groceries, utilities, petrol, gas, water, electricity bills,
• Insurance
• Personal care
• Education and childcare

If you’re refinancing

• Transaction history of the last six months and a most recent statement.
• Account statement for all home loans and personal loans of the last six months (including car loans)
• Most recent Council Rates Notice and home building insurance policy for property
• Documents and all related information & paperwork for your existing home loan.
• Recent Credit card statement

For the first home buyer

• Most recent bank account statements and credit card statement
• Statement of your saving and investment history
• A copy of your Contract of Sale for the house your buying
• Statement for your First Home Saver Account (if available)
• If other funds/ first home buyer benefits are being used for the purchase, proof showing where the funds are held.
• If funds are being given which are not present already in your account then you’ll require a Statutory Declaration from the person advancing you the money.

If you already own a home

• Recent credit card statement
• Copy of Contract of Sale for the property you’re purchasing
• Statement of any existing personal or home loans (not older than six months)
• If other funds are being used then the evidence showing where the funds are held.
• If funds are being given and not currently deposited in your account then you will require a Statutory Declaration from the person who is giving the money
• Statement of your saving and investment history of the last six months.

If you’re a first home buyer then you should always use a mortgage broker for your assistance. Besides guiding they also help you with paperwork and first buyer assistance schemes. So to fix your meeting with a trustworthy and qualified broker reach us at 9907 4624. Or visit our website freshwaterfs.com.au