How to Show Proof of Income to Secure Mortgage

Dear Dr. Don,

My mortgage lender tells me that in order to get a loan approved, I'll need to submit hard copies of my pay stubs. The trouble is I've not been saving them over time.

It's distressing because there's a home on the market I'm eager to bid on. My mother, approved for a loan from the very same lender, wasn't required to provide pay stubs. What's the deal?

All she did was give them a spreadsheet showing the earnings from her job. Am I being picked on here? Should I go to another lender?

Thank you, -- Emily Egregious

Dear Emily,

The lender needs verification of employment. Your mother's employer provided it one way for her. It's possible that your employer didn't respond to the request for verification, so they're taking the next step by asking you.

It could also be that underwriting standards for your loan require pay stubs. You should speak with your employer about verification they can provide in place of your physical pay stubs. Then you could ask the lender to allow the substitution.

I recommend that you stick with the current lender. Each application for credit shows up on your credit report. It is true that anyone shopping among potential lenders should get only one "hit" to their credit score as long as loan applications occur within a short period of time.

The Fair Isaac Corp. publication "Understanding Your FICO Score" says the window for comparison shopping for a student loan, car or mortgage is only 14 days. Since you're already into the loan approval process, you shouldn't risk violating that window.

Ideally, you could make a bid on the home of your dreams without loan preapproval. You'll need to submit an offer contingent on financing. A Realtor or real estate attorney should be able to help you with that.

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