mortgagedocuments

STEP 1: Organizing Your Mortgage Documents

The Most Critical Step to Hassle Free Mortgage Financing!

Without accurate and thorough document review in advance of issuing a mortgage approval … simply put – your mortgage approval is not worth the paper it is written on. The US subprime crisis quite literally erased hundreds of billions of dollars from global capital markets and subsequently forever changed mortgage lending throughout the western world. Mortgage lending today is scrutinized at a new level and so are the documents required to obtain mortgage loans. Toronto mortgages tend to be bigger and thus require more levels of sign off with lenders.

The good news is that in the over $2.0 billion dollars of mortgages we have funded… our team has never had a mortgage not fund when they followed our award winning process and we won’t let yours be the first. We will make sure you successfully navigate the documentation requirements by preparing you in advance. This allows us to provide competitive financing and save you the hassle and stress of a sloppy mortgage approval based on inaccurate information.

Depending on the type of mortgage you are applying for and whether you are an employee of a company or an entrepreneur (self-employed or business for self (BFS)).

Please keep in mind that for mortgages purposes medical professionals, partners at a law firms, and people who own 20% or more of a corporation are deemed to be self-employed. Individuals who derive a significant portion of their income from an investment portfolio or trust (testamentary or inter vivos trusts) are often also required to provide self-employed supplementary documentation. Please also keep in mind that senior executives and people who have a personal taxable income in excess of $500,000 per year are also subject to the same income review that a business owners face.

Having all documents below ready at the time of application submission so they are ready for us will save you the most amount of time and frustration during this process. 

Depending on the type of mortgage transaction and how you earn your income you will need to organize and prepare a slightly different set of documents. Some are these documents are required prior to issuing an approval and some are simply required prior to completing your mortgage file with the lender. Documents required will depend on which of the following categories you fall into:

  1. Mortgage for Residential Purchase
  2. Residential Mortgage Refinance
  3. Full Mortgage Pre-Approval (***one you can rely on where income, assets, and liability details have been confirmed in writing)

Income Verification Documents  (*required at time of application)

Verification of Employment Income

  • Most recent Pay Stub (dated within 30 days)
  • Letter of Employment (dated within 30 days)
  • (If income is highly variable – more than 10% of personal taxable income (i.e. investment banking, partners at accounting/law/consulting firm etc., medical professionals, sales, etc.) Past 2 years of T4 slips and/or Notice of Assessments (NOAs) may be required

Verification of Executive/Self-Employment Income 

  • Personal Tax Returns (complete T1 Generals) – most recent 2 tax years
  • Notice of Assessment (NOAs) – most recent 2 tax years showing no income taxes owing

    *Lenders may also require (as a precautionary measure – plan for it just case)
  • Business Financial Statements – most recent 2 fiscal years (Income Statement, Balance Sheet, etc.)
  • Corporate Financial Documents such as Business License, Articles of Incorporation and/or Business HST Registration & Returns

Mortgage for Residential Purchase (four units or less)

  1. Fully completed Mortgage Application
  2. Agreement of Purchase and Sale including all schedules for subject property and signed by all parties
  3. MLS listing on subject property (Realtor can provide)
  4. Confirmation of down payment (depending upon individual lender/insurer policies, you may be required to provide one or more of the following items):
    • 90 Days of Bank Statements with evidence of gradual accumulation over 90 days
      • Account ownership must be confirmed by providing statements that show your name, an account overview which shows both your name and account numbers, or a VOID cheque for the account
      • Any large deposits aside from payroll must have supporting documentation to verify an allowable source
    • Investment Statements for RRSPs, stocks, etc. with the same proof of account ownership
    • (If funds are gifted) Gift Letter
      • Please note that some lenders / insurers require specific wording on the letter and may require additional documentation in reference to the gift such as verification showing that investment funds or gifted funds have been deposited into the borrower’s account
    • Appraisal Report to confirm the value of the property and the required down payment (most often, the appraisal will be ordered after receiving the Mortgage Commitment from the lender since it must be ordered from an appraisal firm that is acceptable to the lender)
    • (If funds are from sale of existing property) Proof of Existing Equity via both:
      • A copy of the most recent Mortgage Statement for the existing home. The statement should include the lender’s name, mortgage reference number, approximate balance, current mortgage payment and mortgage renewal date
      • Agreement of Purchase and Sale for existing property to verify a firm / unconditional sale of the property being sold (must include all schedules and be signed by all parties)
  5. Lawyer’s Name and Phone Number
  6. Valid ID is required for each borrower and must include both sides of:
    • 1 piece of government issued photo ID (i.e. Driver’s Licence, Passport, or Citizenship Card)
    • 1 additional piece of ID (i.e. Birth Certificate, SIN Card, or Major Credit Card)
  7. Personalized VOID Cheque for the account you wish to use for mortgage payments

Mortgage for Residential Refinance (four units or less)

  1. Fully completed Mortgage Application
  2. Mortgage Statement which includes the name of the lender, mortgage reference number, approximate mortgage balance, current mortgage payment, status of property tax account and mortgage renewal date. The existing lender’s Annual Statement and/or the Mortgage Renewal Document would be ideal for this purpose.
  3. Most recent year’s Property Tax Bill listing annual tax amount and showing account is in good standing
  4. Original Purchase Price & Date
  5. Estimate of Current Value
    • Most lenders will require an Appraisal Report to confirm the value of the property (most often, the appraisal will be ordered after receiving the Mortgage Commitment from the lender since it must be ordered from an appraisal firm that is acceptable to the lender)
  6. (If existing debt is being is being paid from the proceeds of the new mortgage) an accurate and detailed Listing of All Debts will be required
    • It is important to be as accurate as possible with loan balances to ensure there will not be a shortage of funds at closing
    • Copies of Credit Card, Personal Line of Credit, and other Loan Statements showing your name and account numbers
  7. (If you currently have a high-ratio or insured mortgage) Mortgage Insurance (CMHC/Genworth/CG) Reference Number for the existing mortgage being refinanced
  8. Lawyer’s Name and Phone Number
  9. Valid ID is required for each borrower and must include both sides of:
    • 1 piece of government issued photo ID (i.e. Driver’s Licence, Passport, or Citizenship Card)
    • 1 additional piece of ID (i.e. Birth Certificate, SIN Card, or Major Credit Card)
  10. Personalized VOID Cheque for the account you wish to use for mortgage payments

Full Mortgage Pre-Approval

***please note that we do not issue mortgage pre-approvals for borrowers who have not submitted complete supporting documents up front

  1. Fully completed Mortgage Application
  2. Income Verification
    • If salaried – most recent Pay Stub and current Letter of Employment
    • If hourly or highly variable income (i.e. investment banking, sales etc.) –  T4 Slips and/or Notice of Assessments (NOAs) for the last two years
    • If self-employed – Tax Returns (complete T1 Generals) and Notice of Assessments (NOAs) for previous 2 tax years
  3. Most recent Annual Mortgage Statements for each property you currently own
  4. Most recent year’s Property Tax Bill for each property you currently own
  5. Proof of Down Payment via Bank Account, RRSP, Stock/Bond/Investment Statements showing your name, or Gift Letter

Additional Documents

In some cases additional documents may be required. Here are a few common scenarios:

  1. You own other property/properties – Annual Mortgage Statements and Property Tax Bills for each property owned
  2. You own real estate investment rental(s):
    • Valid signed leases to confirm rental income
    • Signed tenant acknowledgements for any leases outside of a 1 year fixed term lease
    • Completion of Real Estate Investment Worksheet (this is supplied by our office and revised frequently – yours must be on the current approved format)
  3. If separated or divorced – a copy of the separation agreement confirming amount of spousal and/or child support payments to be made or received

The #1 Way to Ensure a Hassle Free Mortgage Financing Experience is to Complete Your Mortgage File Within 5 Business Days of Approval

When seeking to borrow hundreds of thousands of dollars, there is simply no way around the need to provide full supporting documents. After your ‘Mortgage Application’ and ‘Client Intake Package’ are completed you will be set up with your own secure online borrower portal which is used to submit all documents required throughout the process.

We look forward to serving you!

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