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Many clients approach me everyday and not surprisingly, all of them at the beginning of our conversation or towards the end (not in a precise order) have the same question. What documentation the lenders will need from me? No matter which individual we are working with (all circumstances are unique) here is a general rule which helps individuals to get organize. The guidelines to obtaining a mortgage are changing every day, the following is a list of the most common requested documents. This is just to help you organize and get a working plan so you know your goals and helps you to identify what exactly you want to accomplish. 

1.  Federal Tax Returns for the last 2 years - In the case you have filed for an extension for the previous year, have your W-2 & income statements on-hand.

2.  Employment History - A record of steady employment in the same field is very favorable factor.

3.  Your Pay Stubs - Have a minimum of a month's worth of pay stubs.  Lenders prefer to see pay stubs that include your name, social security number, employer's address & year to date earnings.

4.  Bank Statements - Mostly likely 2 to 3 months of your last bank statements.

5.   Assets  - List your mutual funds, retirement accounts, real estate, stock & any other assets are helpful in determining your worthiness & getting you a low interest rate.

6.  Credit Report - No matter if you are applying for an FHA loan (that does not use a FICO score to approve a loan), all financial institutions are interested in your debt to income ratios & information on how you have handled debt in the past.  This is a good indicator, this is the time to go over the history and make a note about those items which have some problems. Write down a note of what was happening during that time. This way you are fully prepared and organized. It does works in your favor. First impression is important.

7.  Cancelled Rent Checks and/or Landlord Info - If you currenly rent, being able to prove that you pay your rent is important.

8.  Real Estate Contract - The lender needs to understand the terms & conditions of the property you are purchasing, as well as a description of the property.  I will normally forward a copy of the completely executed contract over to the lender/mortgage broker.

The key to a stress-free mortgage approval is doing the leg work beforehand to ensure that all the necessary paperwork is organized & ready for your lender's review.  Besides saving aggravation, it is also the key to your best interest rate.

At this point we all have passed the "Federal Reserve cut short-term rates" must expected relief but what it really meant to the market. Further more what was the effect to the actual homeowner or the individual trying to reach for his dream.

To look at the matter we have to go back to what history has pointed to us previously, when the Federal Reserve reduced its target 13 times, for the federal fund rates. The average 30-year mortgage rate in the month that was cut, experienced a roller coaster effect.  It proved that a Fed rate cut wasn't a signal to a drop in fixed mortgage rates.

Now we are seeing the real effect as customers are calling expecting to take advantage of the "new" low rates.  To find them selves disappointed and incredulous of the reality and perhaps the more strict guides we are facing.

Understand perhaps, that the actual indicator who affects how the mortgage rates are affected is likely to be investor's expectations. So, if the shadow of inflation shows any signs of acceleration, mortgage rates will go up. This is a understandable outcome.

As we experienced, the mortgage rates do not react to Fed rates moves but anticipates to them. Experts expect the long term mortgage rates to remain stable, unless the economy stumble or take us in a different direction.

Lets be responsible for our acts and the information we choose to convey to the public so we have a more educated and informed customers.