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First Time Buyer

A walkthrough of one real, anonymised file: which numbers get recalculated, which documents trigger a second request, and the three conditions that hold up most closings in Northern Nevada.

What to have ready before your file goes in

  • Two most recent pay stubs, showing year-to-date totals
  • W-2s or 1099s for the last two years
  • Two months of full bank statements — every page, including blank ones
  • A written explanation for any deposit larger than half your monthly income
  • Two most recent pay stubs, showing year-to-date totals
  • W-2s or 1099s for the last two years
  • Two months of full bank statements — every page, including blank ones
  • A written explanation for any deposit larger than half your monthly income
A loan officer reviewing mortgage paperwork at a desk

An underwriter is not reading your file the way you wrote it. They are reconciling three things — income, assets, and collateral — against guidelines that leave very little room for interpretation. Here is what that looks like in practice, using a file that closed in Carson City last month.

They recalculate your income from scratch

Whatever number your loan officer used at pre-approval, underwriting recomputes it. For salaried borrowers that's usually straightforward. For anyone with variable pay it isn't: bonus, overtime and commission generally need a two-year history, and the underwriter averages that history rather than taking the most recent year.

In our example file, the borrower earned $84,000 base plus a $16,000 bonus in 2025 and $9,000 in 2024. The bonus that qualified was $12,500 — the two-year average, not last year's number. That single adjustment moved the debt-to-income ratio by four points.

What to have ready before your file goes in

  • Two most recent pay stubs, showing year-to-date totals
  • W-2s or 1099s for the last two years
  • Two months of full bank statements — every page, including blank ones
  • A written explanation for any deposit larger than half your monthly income

Every large deposit needs a story

Underwriters are looking for money that arrived without a paper trail, because undocumented funds could be a loan in disguise. Anything that isn't payroll gets flagged, and the threshold is lower than most borrowers expect.

Gift funds are allowed on most programs, but they need a signed gift letter, proof the donor had the money, and proof it moved. Screenshots don't clear the condition. Our guide to gift funds and seasoning covers the exact sequence.

The appraisal is a second opinion, not a formality

Collateral review is where a clean file can still stall. The appraiser values the property independently, and if the number comes in below the contract price, the lender lends against the lower of the two. That gap becomes cash you bring to closing, a renegotiation, or a cancelled contract.

Exterior of a single-family home during an appraisal inspection
Appraisers also flag condition issues — peeling paint, a missing handrail — that become repair conditions on FHA and VA loans.

Written by a licensed loan officer and reviewed by the Choose Your Lender editorial team. This article is general information, not a commitment to lend or personalised advice. Rates, guidelines and program terms change — confirm anything here with a licensed loan officer before you act on it. Equal Housing Opportunity.

Every large deposit
needs a story

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