Loan documents: What do I need for a loan approval?

Whether you’re applying for a mortgage, a personal loan, an auto loan, or a student loan, knowing the long list of documents needed for loan approval ahead of time makes the process easier.

Documents required for loan approval vary.

The documents required for loan approval will vary based on the type of loan product you use and the lender’s specific requirements.

Generally, you’ll need to provide proof of income, such as pay stubs or tax returns, and employment verification. Lenders will likely ask for bank statements to assess your financial health and credit reports to check your history of paying bills on time.

Depending on the loan type, you might also need property appraisals or collateral documentation (e.g., insurance cards and odometer statements to buy a vehicle). The documents required for loans that aren’t secured (e.g., personal loans) won’t be as in-depth.

Check with your lender for a comprehensive list of required documents so you can submit everything on time.

Checklist of documents needed for loan approval.

Depending on the type of loan you want, your lender may request additional information, such as a credit check, tax returns, or renting history (if you’re applying for a mortgage) — just to name a few.

Come prepared with the following essential documents to be ready for a productive conversation with your lender.

Loan application.

The exact form will vary from lender to lender, but no matter what, you’ll need to complete the application your lender provides. It’s typically straightforward, with basic questions such as personal information, desired loan amount, and the loan’s purpose.

Proof of identity.

Your lender will want to verify that you are who you say you are. Ensure you have two documents identifying you as a citizen or permanent resident, such as a driver’s license, passport, state-issued ID, citizenship certificate, birth certificate, or military ID.

Employer and income verification.

Now that your lender knows what kind of loan you want and who you are, they’ll ensure you have the financial stability to pay back the loan. Your secure employment should include a salary that makes sense for the loan amount — for example, if you make $50,000 a year, a lender won’t trust you to repay a $1 million loan. Minimally, you should supply pay stubs, tax returns, W2 or 1099 forms, bank statements, and your employer’s contact information.

Handling missing documents required for loan approval.

Missing documents can delay the loan approval process and significantly affect your transaction.

Missing documents are especially concerning if you’re applying for a mortgage, as the lender won’t be able to close until they receive all requested forms. As a result, you could be forced to push back the closing date and might even lose out on your dream home.

With that in mind, be proactive about submitting missing documents as soon as possible, as lenders need time to review these forms for accuracy and completeness.

Work with your lender and other parties in the transaction to avoid delays and complete the deal. Ask for extensions if needed, and see if your lender can give you alternative contacts to track down required forms.

What do I need for a loan if self-employed?

If you’ve found yourself asking what you need for a loan if you’re self-employed, the documents required for self-employed individuals will vary slightly from the requirement for loans issued to W-2 employees.

You’ll generally need to provide additional documentation to lenders, including your personal and business tax returns for the past two years and any 1099 forms. Lenders will consider your post-tax income after deductions, so be careful not to claim too many expenses.

You may also need to provide income statements for the last few months to demonstrate cash flow and savings. Be prepared to provide proof of your company’s existence, such as a business license or registration documents. Keeping those forms organized and on hand will help you accelerate the lending process.

Tips for gathering documents required for a loan.

Scan documents so you have digital versions available and stored securely online. The benefits of digitizing documents are endless when it comes to being properly prepared.

Ask your lender for a document checklist. Print or save a copy of the checklist and mark items off as you submit them, which will help you and your lender stay on the same page throughout the approval process. You should also:

• Scan documents instead of turning in hard copies
• Use descriptive file names rather than generic labels like “screenshot1”
• Prioritize forms that are required for determining loan eligibility

Don’t feel like you have to gather everything before sending in your documents. Submit forms as you locate them so the lender can begin reviewing them.

Prioritize bank statements, pay stubs, and tax returns, as these documents will determine your loan worthiness. While a copy of your ID and other auxiliary information are also necessary, they’re used for regulatory purposes, not initial loan approval.

Tools to organize loan documents and forms.

Are you in the financial services industry? Utilizing the cloud for financial services can simplify organizing and managing financial documents within your business and for your customers.

Explore how you can use Adobe Acrobat to easily sign, store, and organize all your financial paperwork.