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How can I document my debts and assets on a mortgage application?

Q: What will mortgage lenders want to know about my debts and bills?

A: Mortgage applications ask you to list all debts and how much you spend each month on everything from rent or your current mortgage (plus hazard insurance, property taxes, mortgage insurance, homeowners association dues and home equity loans or lines of credit) to credit cards, car loans, student loans, child support and alimony.

Your lender needs to know how much you owe, the required monthly payments, the creditor’s name and address and the account numbers. Save copies of your most recent bills so you can find and accurately report this information.

You won’t have to submit any of those bills, however. The lender will check that information against your credit report, which not only will list all of your debts but also show whether you’re paying your bills on time.

Sometimes a debt won’t show up on your credit report, but you’re still required to disclose it on your mortgage application. Intentionally misrepresenting liabilities (or assets) constitutes fraud.

If you don’t have a credit history, your lender may check with your landlord and utility providers for a history of on-time payments.

Q: How can I prove that I have assets, too?

A: If you own certificates of deposit (CDs), savings accounts, retirement accounts, stocks, bonds, a life insurance policy with cash value, or real estate, you’ll need proof of ownership and market value.

Your two most recent statements from a bank or brokerage will normally satisfy lenders about stocks, bonds and monetary holdings.

For land or other real estate, you’ll need deeds and other documentation. Your lender will determine its current value.

If there have been any unusually large deposits (ones that exceed 50 percent of your total monthly qualifying income for the mortgage) into any of your accounts, the lender will need to know where the money came from. The lender wants to make sure it’s not from another loan that isn’t listed on your application and could prevent you from repaying your mortgage.

If the deposit’s source isn’t clear from your bank statement, you’ll need to document it.

For example, if you sold a car for cash, you could provide a copy of the title transfer, or if you recently received cash as a wedding gift, a copy of the wedding invitation might suffice.

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