Bank Statements For Your Mortgage: What You Need To Know

When applying for a mortgage, your lender will ask to see your financial documents, including your bank statements. Lenders examine bank statements to check your eligibility for a mortgage. Read on to learn more about bank statements and ways to better your odds of being approved for a mortgage.

A bank statement is a monthly or quarterly document that lists all of your banking activity. This helps track finances and gives you the information you need to catch any account mistakes, along with your typical spending habits. 

Each statement usually lists the following:

Log in to your bank or credit union online to find your bank statements. Once you have logged in, look around your dashboard. You may see a tab labeled “Statements” or “Documents.” Once there, you should see links to PDF files labeled “Statement” and the dates. Print out at least two statements from all of your accounts for your lender.

Lenders need to see your bank statements to ensure that you have enough money in your accounts to cover your down payment and closing costs. They will look out for any red flags. For example, someone with numerous overdrafts within a few months before closing on a home may be considered a risk to the bank. 

The underwriting process is when banks and lenders measure the risk of loaning money to a certain borrower, and to determine if that risk is acceptable. Here are some red flags underwriters may look out for:

You can improve your chances of getting a loan by keeping your finances in order and being available when your lender asks for any additional information. Try to avoid any of the red flags mentioned above, don’t take out any major loans before applying, and watch your account spending.

The post Bank Statements For Your Mortgage: What You Need To Know appeared first on Owings Mills & Lutherville Mortgage.