Background

Mortgage underwriting is the paperwork and risk-assessment stage lenders use to confirm what you told them on your loan application. After the 2008 crisis, underwriting tightened: lenders now expect clearer, documented income and asset histories to reduce default risk. In my 15 years advising borrowers, I’ve seen well-organized files cut underwriting time dramatically.

Key documents lenders typically request

  • Income verification

  • Recent pay stubs (usually the most recent 30 days for W-2 employees)

  • W-2 forms (commonly two years)

  • Federal tax returns (personal and, if self‑employed, business returns — usually two years)

  • 1099s for contract or gig work and a year‑to‑date profit & loss statement for self‑employed borrowers

  • Written verification of employment (VOE) or lender callbacks to employers

  • Asset and reserve documentation

  • Bank statements (often 60–90 days for each account used for down payment or reserves)

  • Statements for retirement and investment accounts

  • Documentation of gift funds and a signed gift letter if down payment is gifted

  • Credit and identity

  • Credit report and FICO score pulled by the lender (you should review yours beforehand)

  • Government photo ID (driver’s license or passport) and Social Security number

  • Property and transaction documents

  • Fully executed purchase contract (for home purchase loans)

  • Homeowner’s insurance estimate or binder and recent property tax information

  • Appraisal report (ordered by the lender) and HOA documents if applicable

  • Legal and special‑circumstance paperwork

  • Divorce decree, child support/alimony documents (if income or liabilities are present)

  • Bankruptcy discharge papers and a completed explanation letter for past credit events

  • For VA loans: Certificate of Eligibility; for FHA loans: FHA-specific endorsements — program rules vary

How underwriters use these documents

Underwriters verify that documented income is stable and likely to continue, assets cover the down payment and reserves, and debt ratios meet the lender’s guidelines. They also look for unexplained large deposits, inconsistent tax returns for self‑employed borrowers, or gaps in employment — any of which can trigger follow‑up requests.

Practical examples

  • Salaried borrower: two years of W‑2s, recent pay stubs, and 60 days of bank statements usually suffice.
  • Self‑employed borrower: two years of personal and business tax returns, a year‑to‑date profit & loss statement, and business bank statements are normally required; see our deeper guide on how mortgage underwriters treat self‑employment income for more details.

Common delays and mistakes

  • Missing or partial bank statements, unverified large deposits, or inconsistent income reporting
  • Not resolving credit report errors before application
  • Waiting to obtain HOA documents or insurance estimates until after underwriting starts

Professional tips to speed approval

  • Digitize and label files: paystubs, W‑2s, tax returns, bank statements — one folder per document type.
  • Explain large deposits in writing with supporting source documents (sale proceeds, transfers, gifts).
  • Order a free credit report and correct errors before you apply (annualcreditreport.com and CFPB guidance).
  • Keep funds in place until closing: moving money between accounts can create new verification steps.

Turnaround time

Underwriting often takes 1–3 weeks once the file is complete, but it can be shorter for straightforward conventional loans or longer for government programs or complex self‑employed income. Missing documents are the most common cause of delays.

Who is affected

All mortgage applicants go through underwriting; program rules differ. Government‑backed loans (FHA, VA, USDA) and jumbo loans have specific documentation and reserve requirements. For program specifics, consult lender guidelines and federal resources.

Related FinHelp articles

Authoritative sources and further reading

Professional disclaimer

This article is educational and does not constitute personalized financial or legal advice. Requirements vary by lender and loan program; consult your loan officer or a certified mortgage advisor for guidance tailored to your situation.