How to Prepare before Applying for a Mortgage

If you're thinking about buying a home, you probably already have great ideas for your new kitchen, what you’re going to do in the yard and how you’ll become besties with the new neighbors. But before you fall in love with your dream of the perfect property, there's an important thing you need to do—get mortgage-ready. Applying for a home loan can feel a little overwhelming. Going into the process organized and informed can save you a lot of time, stress, and even money. Here’s a friendly breakdown of what you’ll need and why it matters.

Show Them the Money: Income Documentation

Lenders want to see that you have a steady and reliable income. You’ll need to have your most recent paystubs, W-2s or 1099s, and a couple of years of tax returns ready to go. If you're self-employed, the list gets a little longer with forms like your Schedule C, 1120s, or K-1s. This paperwork helps lenders determine whether you can afford the home you're eyeing. Having everything on hand up front makes the process faster—and shows the lender that you’re serious and organized.

Your Credit Story: Honesty and Transparency Go a Long Way

Your credit history plays a huge role in your mortgage approval. If you’ve had a few bumps along the way (late payments, collections, or other “credit derogatories”), go ahead and prepare a letter explaining those issues. Lenders don’t expect perfection—but they do appreciate context. You’ll also need recent mortgage statements for any properties you already own, and proof of homeowner’s insurance and property taxes if they aren’t escrowed. These documents help paint the full picture of your financial situation.

Assets and Assistance: Where's the Down Payment Coming From?

You’ll also need to show where your down payment and closing costs are coming from. This could be from a savings account, retirement account, sale of personal property, or even a gift from a family member. If you're using down payment assistance or employer help, gather those details too. Being upfront about your assets gives your lender the confidence that you’re financially prepared and helps them match you with the best loan options.

Employment and Education: Building the Bigger Picture

A two-year employment history is typically required, along with contact details for your current and past employers. If there were any gaps or changes in your career path, now’s the time to gather that information. For recent graduates or those still building their work history, educational background can also be helpful. It all contributes to you presenting yourself as a responsible and reliable borrower.

Know what to Prepare

Download our Mortgage Prep Checklist:

Preparation Really Does Pay Off

Applying for a mortgage isn’t just about filling out a form—it’s about demonstrating that you’re financially ready to take on homeownership. By gathering the documents outlined above, before you even sit down with a lender, you’re setting yourself up for a smoother, faster, and more confident journey to loan approval. After you’ve downloaded the above check list, check off each item, and take that next step toward making your home dreams a reality.