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lender may contact HR and have them verify everything you've told them and, in addition, you'll have to give your lender your last couple of pay stubs. You may have to drive down to your cable, cell phone and utility provider and get them to verify you've paid your bills on time for the last twelve months. You might have to dredge up your income tax returns and W-2's for the past two years. You may need 2-3 months worth of bank statement printouts, recent 401(K) or stock statements or anything of the like. The lender may ask to see your divorce decree and/or marital resolution. You may be asked to show you have received child support, deposited into your account for twelve months and that it will continue for the next three years. You might have to dig through your filing cabinet and get out lease agreements for rental properties you own. And don't forget if you're self employed, it only gets worse. K1's, partnership returns, and W-9's are common fare.

The good news is that most required documentation falls somewhere in between requiring a handshake and requiring a DNA sample. If you are pulling cash out of the property during a refinance, you will have to show some type of documentation. If you are only putting 3% down payment on the loan, your income will be examined more closely than putting 30% down. The risk factor is higher for the lender. The layering of risk was once explained to me as layers of an onion. For some reason, this analogy made sense to me. The more layers you have to peel back, the more risk is involved. Lower credit score, self employment, adjustable rate mortgages, ownership of multiple properties and cash out refinancing are examples of different traditionally identified risk factors. Alone or combined together, you can expect increased documentation requirements.

So, be patient with your lender when they pluck that hair sample from your head. They're not being nosy, they're just being thorough.

Learn more about this author, Kristin Abouelata.
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