We've all heard horror stories of mortgage applications gone wrong. It can be scary and overwhelming and I want to help take some of the stress out of the process for you.
First, it's important to note that all financing requires some level of income to support the loan you're seeking. This is even more relevant during this time of COVID-19. In fact, in today's current market, it's not only important to show some level of income; it's imperative to show a sustained and continuous income in order to qualify for a mortgage.
Ask yourself a couple of questions: Are you facing a layoff? Is your company looking to cut costs to survive the pandemic? Is your job guaranteed security?
Once we've established reasonable answers to these questions, and decide to proceed with the application; I need all of your income verification documents UP FRONT. My lenders will not even look at an application unless I have everything I need before sending the file in for review. So what do you need to send me?
Employment letter dated within 30 days. This letter needs to be on company letter head outlining the name of the employer, your position with the company, annual gross income, and length of your employment.
Paystub within 30 days
2018 & 2019 T4
2018 & 2019 NOA
3 months bank statements to support your payroll deposits
And your 2019 T1 General tax return if there is other income we need to include.
Separation/Divorce agreement, if applicable
Gift letter, if applicable
Proof of downpayment (investment statements, etc.)
Yes, this list is extensive and it seems like I'm asking for everything but your left arm; but, I can assure you that not only will providing these documents go a long way to getting the approval, they're also going to ensure the deal gets to CLOSE.
If you're self-employed, the required documentation looks a little different:
3 years T1 Generals & NOAs
Master Business License or Articles of Incorporation
6 months bank statements
Website or Source of business
A detailed description of where you work, how you work, etc.
Another important factor to note is that 65% is the new 80%. That means your downpayment isn't going to go as far as it would have pre-pandemic. Capital is drying up and the amount of money you need up front is greater; which could make it harder to get you approved. This isn't to say it can't be done at 80%; every application is handled on a case by case basis.
Things are tough right now for all of us and if I can do anything to help make the process for purchase, refinance or renewal easier, then I'm going to do just that. With the above information and a phone call (905-320-4477), we can take a look and see just how I can help you.
I hope you've found this information helpful. Stay home, stay safe and above all else know that I'm here to help.