What Mortgage Lenders Will Ask For—You May Be Surprised

Getting a mortgage has never been more challenging than it is in today's market. You never know where you'll get the best deal for your mortgage these days and you don't know who will say yes, given all that has changed in the mortgage industry.

What will be even more frustrating is that you never get to know how long it will take. In today's market, banks are understaffed and overworked. Loan applications are backed up for weeks, even months. Stricter qualifying requirements may drag your loan approval out to the very last possible day. It can be one of the most frustrating aspects of buying a home today. But the good news is: now that you know what you are in for, you'll be prepared for the worst!

What Lenders Will Ask For-You May Be Surprised You will probably find that your application experience with two different lending candidates will be tremendously different from each other, and for no good reason. One might demand that you prove X, Y, and Z while the other never asks the same questions or brings up a whole other set of concerns. One bank officer might want to review your tax returns for the past five years, plus copies of checks you've written, while a mortgage broker may not care so much about your past income but picks on your potential future income.

Bottom line: you just never know what you're going to encounter when you start working either with a broker or directly with a bank. Be prepared to answers all their questions and provide whatever documents they ask for. Be honest. Be organized. And be on time if they give you deadlines. A lot of mortgage programs have deadlines attached to them and if you miss them, you miss the deal. Also be prepared to provide letters from your accountants and lawyers if necessary.

A friend of mine in Los Angeles actually had his mortgage application refused at one bank because his wife was pregnant, and the bank was afraid of a loss in household income that next year. It seemed like a ridiculous reason for the lender to turn them down, but it happened.

In today's market, you need to approach the mortgage department with a thick skin. Don't get emotional and don't get defensive and don't take it personally. Most lenders place multiple conditions on an application, and they will keep adding conditions until they are satisfied with what they have from you in order to finish processing the loan and approve it. So be prepared to provide additional documents, letters, verifications, and income statements right up to the last minute!

-Michael Corbett

Michael Corbett is Trulia's real estate and lifestyle expert. He is also the host of EXTRA's Mansions and Millionaires on NBC. In addition to his regular segments on ABC's The View and Fox News, he is a national best selling author with three critically acclaimed real estate books:Find It, Fix It, FLIP IT!; Ready, Set, SOLD! and Before You BUY! His years of experience in buying, renovating, and selling homes have made him a sought-after nationally recognized real estate expert.