Loan documentation requirements for a Jumbo mortgage in Orange County are the same as most other types of mortgages, including Fannie Mae, FHA, and VA. With “stated income” a thing of the past, borrowers need to get used to providing full income and asset documentation to the lender in order to get a loan for a home.
Income Documentation Requirements
For a home buyer who is a “W2’d” employee of a company, the following will need to be provided.
- Most recent paystubs for the previous 30 day time period.
- Tax returns for most recent two years with supporting schedules.
- W2’s for most recent two years.
A borrower is considered to be self employed under several circumstances. If they receive income on a “contract basis” and do not have taxes taken from the checks, then they most likely file a Schedule C with their personal tax returns. The lender will need to see two full years tax returns and is interested more in the Adjusted Gross Income, not the gross income on the Schedule before expenses are taken out. There are certain things that can be added back, such as Depreciation, but a good Loan Advisor can help with this.
Borrowers who own more than 25% of a Corporation, whether a C Corp or S Corp, will also need to provide the following:
- Two years K-1’s
- Two years 1120’s (C Corp) or 1120s’s (S Corp) with all supporting schedules.
- Signed year to date Profit and Loss (Income and Expense statement) and Balance Sheet/Financial Statement, if the loan is being processed more than 120 days after the year end.
For those borrowers who are in a Partnership, similar documentation is required, except the tax forms are called 1065’s. Limited Liability Companies (LLC) also have similar documentation depending on the number of owners and how the company was initially set up.
While the amount of documentation required for a mortgage right now may seem excessive as compared to a few years ago, the loan process is actually not nearly as difficult as it may seem. As long as the Orange County home buyer is prepared ahead of time to provide the necessary documentation, the loan process can go smoothly. Troubles begin only when either the Loan Officer doesn’t ask for enough documentation up front to get a true picture of the borrowers qualifications, or the borrower resists providing some of the documentation until absolutely necessary.
It’s Imperative to Find An Experienced Orange County Loan Officer
The experience of the loan officer is more important than ever. Gone are the days when a loan officer could bring a loan in, “throw it against the wall” and have it fund. Your loan officer needs to thoroughly review the file upfront before it gets to the underwriter if you want to have a pleasant” loan closing experience.
Authored by Tim Storm, an Orange County, CA Jumbo Mortgage Loan Officer – Please contact my office at Alpine Mortgage Planning for more information about an Orange County, CA Jumbo loan. 877-786-4243 x 7.
Call our office today and see how we can help you and your family.
877.786.4243 x 7 | tstorm (at) ochomebuyerloans.com