If you are planning to buy a home, you will want to speak with a mortgage broker first. Doing so will allow you to know where you are financially and what kind of mortgage you qualify for.

When applying for mortgages, your broker will want to see some documents to prove that you can pay them off. You will need to have several documents on hand, and missing even just a single one of these can harm your chances of getting a mortgage. Make sure to have the following documents with you:

Income Documents

What mortgage brokers first look for is a steady stream of income. Having this is a big guarantee for them that you have the financial resources to pay off your mortgage every month. Aside from that, they will have to check whether your income is enough to handle these expenses.

Some documents that you can use as income proof are:

• Pay Stubs – The pay stubs you receive from your employee whenever you receive your salary.
• Tax Returns – The T1 tax forms document your tax returns, easily proving that you are a taxpayer.
• Letter of Employment – This is a letter you may request from your employer that will state that you are indeed employed at the company and earning a specific salary.

Personal Financial Documents

Aside from your income, brokers may request additional personal documents. These personal documents are often used to check your credit score and if there are other outstanding loans or transactions that you have that may affect your ability to pay for the mortgage. Below are the documents you may show:

• Bank Account Information – The brokers will request your bank account information for payment purposes.
• Statement of Assets and/or Investments – These assets and investments are worth a certain amount, which can be used as a down payment or as a backup if you fail to pay.
• Credit Report – The broker will do this as part of your background check. They will see your credit score, which is determined by how well you pay loans, debts, taxes, bills, and more.

Down Payment Documents

Now that you have proved that you can pay and have the financial resources, the brokers will want to see whether you have the down payment available to kick off your mortgage. You can use these documents below to show that you have the initial down payment for the transaction.

• Savings or Bank Account Statement From Last 3 Months – You can request this from your bank to show that you have enough money in your account in the last three months to cover your down payment.
• Sale Agreement of Existing Property – If you have sold your old home or another property to purchase your new one, you can use the sale agreement as proof that you have gotten proceeds and will use that as a down payment.

Property Documents

The broker will also request documents of the property you are purchasing to assess its details. The documents you will need to show for this are the following:

• Purchase and Sale Agreement – This document will include your home’s payment scheme and details. It will also have your planned down payment and the principal amount.
• MLS Listing – The listing will include other details, such as property tax estimates, condo fees, and more.
• Legal Home Description – The description of the property will include the full address and postal code.

Conclusion

Buying a home requires a lot of determination, hard work, and patience. To get you started, you need to have the proper documents and other essentials, such as employment, income, and down payment. When you finally have all of these, you can go on and visit a mortgage broker to discuss your specific needs.

To submit a mortgage application in Ontario, contact us at Mills Financial Group. We will be happy to help you with your mortgage needs, ensuring that it is within your means. Get in touch for further information.