The decision to take out a mortgage is extremely important for the future borrower. However, not only for him. The bank must also think carefully and consider lending a large amount of money to the client.
Due to the risk it incurs in this respect, it carries out the verification process of the loan applicant very thoroughly and reliably. It is necessary to analyze a number of documents submitted by a potential borrower. To avoid surprise and unnecessary stress, it is worth getting acquainted with them before visiting the bank.
Some loans can be obtained within a few minutes. However, the time needed to get a mortgage is much longer and the criteria for granting it are much more restrictive than with a cash loan. When applying for a mortgage to buy an apartment or house, first of all, we must submit a loan application. Attach a number of important documents to it. Their type and quantity will vary depending on the bank to which we go. However, in each of us we will have to present documents certifying the achieved income and basic documents regarding the property. The documents necessary to apply for a housing loan can be divided into four groups: identifying the borrower, related to income, real estate and other financial liabilities.
Documents identifying the borrower
They confirm the identity of the borrower and in some respects inform the bank about his family situation. Such documents include:
- ID card and a second photo ID, e.g. driving license, passport, insurance card);
- in the case of intercourse – a contract in the form of a notarial deed stating property separation;
- in the event of separation or divorce of spouses, a final court decision confirming this state of affairs;
Income related documents
a) In the case of an employment contract, it is necessary for the employer to complete a bank certificate of employment and the amount of income obtained by the borrower. Often, an additional personal account statement for the last 3 months should be attached, where the impact of remuneration is visible. In addition to the documents listed above, some banks require the borrower to provide e.g. a credit card statement, an annual tax return or a work certificate. It depends on the individual procedures and requirements of a particular bank.
b) When the borrower’s income is derived from conducting business, the bank requires the borrower to provide slightly different documents. They are:
- decision to assign a REGON number and tax identification number;
- certificate of entry in the business register or other document which certifies the fact of conducting business activity;
- certificate from the Tax Office on tax arrears;
- certificate from the Social Insurance Institution about the lack of contributions;
- PIT declarations for the previous year.
In addition, the mortgage applicant must provide the bank with documents that allow determining income for the current year. They differ depending on the method of accounting with the Tax Office
- Natural persons conducting business activities and settling accounts with the Tax Office on general principles are required to present to the tax bank the revenue and expense ledger.
- Persons settling with the Tax Office on a lump sum basis on recorded revenues are required to provide the bank with a statement on the amount of income in the current year and a record of revenues showing the revenues generated in the current year. In addition, some banks require a company current account statement to be attached.
- Those who conduct business with the Tax Office on the basis of a tax card must provide the bank with the current decision of the Tax Office determining the amount of tax in the form of a tax card.
c) In a situation where the borrower’s income is obtained under a specific work contract or mandate contract, the bank additionally requires a copy of the contracts from the last 12 months together with bills and a PIT tax return, at least for the last year. Sometimes it is also necessary to attach a bank statement.
Real estate documents
These documents are extremely important because they relate directly to the subject of lending and loan collateral. They will be different for real estate purchased on the primary market and different when on the secondary market.
a) For the primary market, the basic documents are:
- preliminary agreement with the developer;
- an excerpt from the land and mortgage register of the land on which the investment is being carried out;
- an excerpt from the land register records regarding the plot on which the investment is carried out;
- documents regarding the developer or the housing association itself (excerpt from the National Court Register);
- final decision on the building permit;
- permission to use or confirmation of acceptance of the building for use without reservation by the competent authority if construction has already been completed;
- a promise from the bank for a non-encumbered mortgage release;
- copies of proxies of persons representing the developer (when they are not listed in the National Court Register).
b) In the case of purchasing real estate on the secondary market, the loan application should be accompanied by:
- preliminary property purchase agreement;
- excerpt from the land and mortgage register kept for an apartment or house;
- documents confirming ownership of the property by the seller;
- if the property is owned by a housing cooperative, attach a cooperative certificate of receipt and a certificate of non-payment.
Documents regarding other financial liabilities
In a situation where we have permanent financial obligations, e.g. due to another loan, which we are still repaying or have recently repaid, the bank will require us to provide copies of contracts, evidence of recent payments or a certificate from the bank regarding the full repayment of such liability. This also applies to credit cards held and overdraft limits.