Checklist of documents needed for a home loan application

Once you’ve decided to apply for a home loan, the first step is to start gathering the necessary documents for the application process. While the exact disclosures required can differ from lender to lender, there are specific documents that are usually mandatory to supply while applying for a mortgage. Even if your lender requires additional documents, preparing the basics beforehand could save you considerable time. 

Which identification documents are required? 

Lenders are legally required to confirm that you are who you claim to be before they can supply a loan. Therefore, you must provide at least one primary and two secondary identification documents: 

Primary documents: 

• Passport
• Australian driver license
• Australian citizenship certificate
• Australian certificate of identity

Secondary documents:

• Medicare card
• Federal Concession cards
• Australian Seniors Card
• Australian birth certificate
• Australian citizenship certificate

If you already have an account with the lender, such as if they’re your current bank, you might not have to provide extra identification documents, as this information may already be on file. 

Which documents are required to assess your income?

Income information is crucial for lenders to assess your ability to repay the loan without putting your finances under undue stress.

The types of documents and disclosures you’ll need for this stage of assessment will depend on your type of employment: 

• Salaried employees may need to provide a bank statement that highlights the last two salary payments and payslips from three months before the application. They may also need a letter from their employer confirming their employment details.
• Self-employed applicants may need to provide financial statements from the past two years and/or a letter from their accountant.
• Those receiving superannuation income may need to provide a super fund statement or a bank statement that displays their current average income.
• Those receiving a government income can provide Centrelink statements or current bank statements that display their government payments.
• Property investors may need to provide the lender with a current bank statement, plus details of their current lease arrangement and a letter from their real estate agent and property manager.
• Share investors may need to provide their shareholding certificate(s) or a current dividend statement notice.

Which documents are required to assess your financial position?

To assess your overall financial position as part of your home loan application, the lender will most likely ask for disclosures related to your assets, including superannuation, shares, vehicles, etc. Additionally, the lender will also gather information about your debts, like credit cards, bills, loans and Afterpay purchases. 

The lender might also ask you to disclose the details of your monthly living expenses, including transport, groceries, entertainment, clothing, TV, phone, education and childcare, etc. A monthly breakdown of your expenses helps a lender ensure that you have enough funds to cover your mortgage repayments without any hassles.  

All of these factors will also be considered when determining the interest rate and the loan amount the lender is willing to offer if they accept your application. Some lenders may require more documents, especially if your application isn’t an average one, such as when you’re applying for a home loan with a bad credit score.

Before applying for a home loan, you may want to carefully browse through your options and consider selecting a lender that provides an exact list of documents needed for your home loan application, and is willing to offer an interest rate, fees, features and benefits that will suit your needs now and in the future.

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