Getting pre-approved for a mortgage is one of the smartest first steps in your home-buying journey. But let’s be real—no one loves paperwork. Knowing exactly what to prepare makes the process smoother and helps you avoid delays.
Whether you’re a W-2 employee, 1099 contractor, or self-employed business owner, here’s exactly what lenders need—and the credit score ranges they’re looking for.
📑 Why Do Lenders Ask for These Documents?
Lenders focus on three key factors:
✔️ Verifiable, stable income
✔️ Ability to afford monthly payments
✔️ Financial responsibility and creditworthiness
They’ll tailor the required documents based on how you earn income.
💼 W-2 Employees
If you’re a salaried or hourly employee receiving W-2s:
You’ll Need:
• ✅ Most Recent W-2s (1–2 years)
• ✅ 30 Days of Pay Stubs
• ✅ 2 Months of Bank Statements
Credit Score Guidelines:
- 🔻 Lowest accepted: 580 (FHA loans with 3.5% down)
- ✅ Recommended minimum: 620
- ⭐ Sweet spot: 740+ for best rates and terms
Pro Tip: Ensure your pay stubs, W-2s, and bank deposits match—lenders check for consistency.
📝 1099 Contractors & Gig Workers
For independent contractors and freelancers:
You’ll Need:
• ✅ 12 Months of 1099 Forms
• ✅ 2–12 Months of Bank Statements showing consistent deposits
• ✅ Possibly a year-to-date P&L, depending on lender
Credit Score Guidelines:
- 🔻 Lowest accepted: 620 (FHA or bank statement loans)
- ✅ Recommended minimum: 660
- ⭐ Sweet spot: 720+ for competitive conventional loan rates
Pro Tip: Lenders may average fluctuating income over 12–24 months to assess stability.
📊 Self-Employed Borrowers
If you own a business or are a sole proprietor:
You’ll Need:
• ✅ 2 Years of Personal & Business Tax Returns
• ✅ Year-to-Date Profit & Loss Statement (P&L)
• ✅ Business Bank Statements
Credit Score Guidelines:
- 🔻 Lowest accepted: 620 (FHA or certain non-QM lenders)
- ✅ Recommended minimum: 680
- ⭐ Sweet spot: 740+ for best rates and flexibility
Pro Tip: High write-offs reduce taxable income—be mindful of how that affects your loan amount.
🏦 Other Commonly Requested Documents
Depending on your scenario, lenders may also ask for:
• A government-issued ID
• Social Security number (for the credit check)
• Gift letter if someone’s helping with your down payment
• Letters of explanation for large deposits, credit issues, or job gaps
🎯 Why Pre-Approval Is So Important
Pre-approval not only tells you how much home you can afford—it also shows sellers that you’re financially qualified and ready to move forward. The more prepared you are, the faster you can close.
👋 Ready to get pre-approved?
📅 Schedule your FREE consultation now:
👉 Book Here
📱 Text or call me directly at 469-336-3027
🌐 Explore more at: KoryWhiteRealEstateGroup.com
Let’s get your paperwork ready and your keys in hand.
