Why do Loan Officers Ask For So Much Paperwork?

Loan officers ask for way too many paperwork and they have borrowers sign way too many documents! The standard financial paperwork that a loan officer will ask for are:

Most current two years federal tax returns (Year To Date Profit and Loss Statement for self-employed)
Most current one full month of paystub(s)
W-2 statements for the past two years
Most current 2 months (reflecting a 30 day history) bank statement

Once those documents are submitted to the loan officer they will review the documents and determine whether or not more documentation is needed. Here are some examples of when a loan officer will ask for more documents:

· The bank statement shows a large deposit that is not the normal amount of your deposits. Where did that money come from? Or the total balance is less than what you need for closing cost.
· Tax returns show that you have a small partnership in another company or have a second business that was not documented in the loan application because it’s just “play” money and “not that important”. If it shows anywhere on any of the documents provided, lenders will ask for more information regarding it.

There are more situations that may occur where your loan officer will ask for more documents. Trust me when I tell you that we really don’t want to ask for it but it’s a must to ensure proper documentation and due diligence.

– Linda Le, 808-561-5943, Loan Officer, Pacific Access Mortgage