Upfront Documents: Collect the Right File the First Time
A strong document request is specific to the borrower. Start with the standard package, then add items triggered by income type, assets, credit, REO, property and program.
Standard Wage-Earner Starter Package
| Document | Common starting request | Why the LO needs it |
|---|---|---|
| Paystubs | Most recent 30 days | Current earnings, YTD income, deductions, employer and pay frequency. |
| W-2s | Most recent 2 years | Employment/income history and reconciliation to current application. |
| Bank statements | Most recent 2 months, all pages | Cash-to-close, reserves, ownership, transfers and large-deposit review. |
| Photo ID / driver's license | Current government-issued ID | Identity and application consistency. |
| Purchase contract | Fully executed, all pages/addenda | Price, seller concessions, property, dates and parties. |
Self-Employed Borrower
Commonly add two years of personal and business tax returns when required, current YTD profit-and-loss statement and balance sheet when required, business ownership documentation, and possibly business bank statements. Gross business revenue is not qualifying income. The LO must determine ownership percentage, business type, history and whether using business funds affects the company.
Asset Red Flags to Teach
Large deposit
Do not ignore it or delete it from the application. Determine whether it must be sourced under the program.
Transfer
Trace between accounts so the same funds are not double-counted and the source is clear.
Gift
Identify donor, eligibility and transfer documentation requirements.
Business funds
Confirm borrower access and whether withdrawal harms business liquidity when applicable.
Credit Checklist
Reconcile credit with the interview: mortgage/rent, auto loans, student loans, revolving debt, co-signed debt, alimony/child support, tax liens/judgments where applicable, new accounts, inquiries and undisclosed obligations. Ask what changed after the report was pulled.