Tricky Doc requests
Joel Olson • October 28, 2021
TRICKY DOC REQUEST What to do, when you don't know what to do.
1. I have no agreement and have been separated for years.
If you are separated or divorce, we are looking for an agreement that confirms that you pay no spousal support, child support and that all your assets have been divided equally. If none of these things would have applied you can reply to that doc request that you wish to sign a stat dec at the time of closing as none of this applicable.
2. I can’t get a job letter.
Every lender these days need to verify your employment by way of a job letter from your employer. Whoever does payroll will be able to provide you with one. The letter should be signed have a number in which a lender can to verify. The letter itself must state your start date, # of guarnateed hours every week or your yearly salary as well as your hourly wage.
3. I don’t have access to Tax Returns
You can get your tax returns from your bookkeeper or accountant or whoever assembled your taxes. Your tax returns are not the same as your notice of assessments that just tell us how much income that you have made. Your tax return must contain all the pages, which will tell us how much any business or rental property grossed and its applicable expenses. We have to get all the pages of the return to be able to use it.
4. Where do I get a property tax statement?
You can simply call your applicable municipal office, they can supply you with one by email which will be sufficient.
5. Where do I get a gift letter from?
We don’t need to have a gift letter signed till after we get you approved. Every lender will have their own form.
6. Do I have to sign all the contracts?
Yes, it's important that you know exactly what to expect and when to expect it, so please make sure to address any questions that you have.
7. Do I need to show the downpayment if I haven’t found a house yet?
Different sources of downpayment matter. We need to know that we can verify where your downpayment funds are coming from. We can’t wait to see funds in your account, but we need to know where we are coming from. Anti-money laundering insists that we can give a history of every account that is sourcing the downpayment as well. We can’t just accept a screenshot of your account
8. I work for myself- do I need a job letter?
If you are an owner of a company regardless of how you get paid, we will need to see your last two years tax returns as well as your last two years company financial statements. You won’t need a job letter though
9. Do you really need a void cheque?
The void cheque is the account which will be debited the mortgage payment. We can wait on that, but we will need it.
10. Can you give me a rough idea on what I qualify for
There are some many way we have to calculate qualifying. How much you work, for how long you have worked, how many hours, how much downpayment, and where you are buying are all questions that can make a meaningful impact on your application and change how much you qualify for. This is why we have to get all the information and documents before making a decision.
A question that comes up from time to time when discussing mortgage financing is, “If I have collections showing on my credit bureau, will that impact my ability to get a mortgage?” The answer might have a broader implication than what you might think; let's spend a little time discussing it. Collections accounts are reported on your credit bureau when you have a debt that hasn’t been paid as agreed. Now, regardless of the reason for the collection; the collection is a result of delinquency, it’s an account you didn’t realize was in collections, or even if it’s a choice not to pay something because of moral reasons, all open collections will negatively impact your ability to secure new mortgage financing. Delinquency If you’re really late on paying on a loan, credit card, line of credit, or mortgage, and the lender has sent that account to collections, as they consider it a bad debt, this will certainly impact your ability to get new mortgage financing. Look at it this way, why would any lender want to extend new credit to you when you have a known history of not paying your existing debts as agreed? If you happen to be late on your payments and the collection agencies are calling, the best plan would be to deal with the issue head-on. Settle the debts as quickly as possible and work towards establishing your credit. Very few (if any) lenders will even consider your mortgage application with open collections showing on your credit report. If you’re unaware of bad debts It happens a lot more than you’d think; people applying for a mortgage are completely unaware that they have delinquent accounts on their credit report. A common reason for this is that collection agencies are hired simply because the lender can’t reach someone. Here’s an example. Let’s say you’re moving from one province to another for work, you pay the outstanding balance on your utility accounts, change your phone number, and make the move. And while you think you’ve paid the final amount owing, they read your meter, and there is $32 outstanding on your bill. As the utility company has no way of tracking you down, they send that amount to an agency that registers it on your credit report. You don't know any of this has happened and certainly would have paid the amount had you known it was due. Alternatively, with over 20% of credit reports containing some level of inaccuracy, mistakes happen. If you’ve had collections in the past, there’s a chance they might be reporting inaccurately, even if it's been paid out. So as far as your mortgage is concerned, it really doesn’t matter if the collection is a reporting error or a valid collection that you weren’t aware of. If it’s on your credit report, it’s your responsibility to prove it’s been remediated. Most lenders will accept documentation proving the account has been paid and won’t require those changes to reflect on your credit report before proceeding with a mortgage application. So how do you know if you’ve got mistakes on your credit report? Well, you can either access your credit reports on your own or talk with an independent mortgage advisor to put together a mortgage preapproval. The preapproval process will uncover any issues holding you back. If there are any collections on your bureau, you can implement a plan to fix the problem before applying for a mortgage. Moral Collections What if you have purposefully chosen not to pay a collection, fine, bill, or debt for moral reasons? Or what if that account is sitting as an unpaid collection on your credit report because you dispute the subject matter? Here are a few examples. A disputed phone or utility bill Unpaid alimony or child support Unpaid collections for traffic tickets Unpaid collections for COVID-19 fines The truth is, lenders don’t care what the collection is for; they just want to see that you’ve dealt with it. They will be reluctant to extend new mortgage financing while you have an active collection reporting on your bureau. So if you decide to take a moral stand on not paying a collection, please know that you run the risk of having that moral decision impact your ability to secure a mortgage in the future. If you have any questions about this or anything else mortgage-related, please connect anytime! It would be a pleasure to work with you!
Deciding to list your home for sale is a big decision. And while there are many reasons you might want/need to sell, here are 3 questions you should ask yourself; and have answers to, before taking that step. What is my plan to get my property ready for sale? Assessing the value of your home is an important first step. Talking with a real estate professional will help accomplish that. They will be able to tell you what comparable properties in your area have sold for and what you can expect to sell your property for. They will also know specific market conditions and be able to help you put a plan together. But as you’re putting together that plan, here are a few discussion points to work through. A little time/money upfront might increase the final sale price. Declutter and depersonalize Minor repairs A fresh coat of interior/exterior paint New fixtures Hire a home stager or designer Exterior maintenance Professional pictures and/or virtual tour But then again, these are all just considerations; selling real estate isn’t an exact science. Current housing market conditions will shape this conversation. The best plan of action is to find a real estate professional you trust, ask a lot of questions, and listen to their advice. What are the costs associated with selling? Oftentimes it’s the simple math that can betray you. In your head, you do quick calculations; you take what you think your property will sell for and then subtract what you owe on your mortgage; the rest is profit! Well, not so fast. Costs add up when selling a home. Here is a list of costs you’ll want to consider. Real estate commissions (plus tax) Mortgage discharge fees and penalties Lawyer’s fees Utilities and property tax account settlements Hiring movers and/or storage fees Having the exact figures ahead of time allows you to make a better decision. Now, the real wildcard here is the potential mortgage penalty you might pay if you break your existing mortgage. If you need help figuring this number out, get in touch! What is my plan going forward? If you’re already considering selling your home, it would be fair to guess that you have your reasons. But as you move forward, make sure you have a plan that is free of assumptions. If you plan to move from your existing property to another property that you will be purchasing, make sure you have worked through mortgage financing ahead of time. Just because you’ve qualified for a mortgage in the past doesn’t mean you’ll qualify for a mortgage in the future. Depending on when you got your last mortgage, a lot could have changed. You’ll want to know exactly what you can qualify for before you sell your existing property. If you’d like to talk through all your options, connect anytime! It would be a pleasure to work with you and provide you with professional, unbiased advice.
