Buying a new house can involve paperwork, especially if you take out a mortgage. You may be overloaded with documents before, during, and after you close on your home. You may hesitate to toss anything with many forms, statements, and legal documents.
Before overloading with paper, you may wonder how long to keep mortgage statements and documents.
Key Takeaways
- A mortgage statement shows vital information about your loan.
- You get a new mortgage statement every month.
- While holding onto your mortgage statements may not be necessary, keeping all legal documents associated with your mortgage and home is.
How Long to Keep Mortgage Statements
A mortgage statement shows your account activity since the last billing cycle. Unlike other mortgage documents, the information on your account statement changes each billing cycle.
Information Your Mortgage Statements Contain
- Upcoming payment information: A monthly statement reveals how much you must pay each month. In addition, you see how much of your payment goes toward principal and interest. If part of your monthly payment goes toward escrow for your homeowners’ insurance and property taxes.
- Loan and account details: Your statement contains basic information about your mortgage, such as your account number, property address, interest rate and the loan’s maturity date.
- Transaction history: A mortgage statement shows your account's current charges and payments during the billing period.
- Past payment breakdown: On your mortgage statement, you can see how much principal you've paid for the month.
Other Mortgage Documents to Keep
While you can toss some mortgage documents, you should hold onto key documents until you've sold your home or paid off your mortgage. Key documents to keep when you own your home include:
Deed
Deeds are among the most important legal documents to keep. A deed offers proof that you own your home.
Mortgage Notes
A mortgage note is the contract between you and the lender. When you sign a mortgage note, you agree to pay back what you’ve borrowed. The note includes details about your loan, including your agreement to use your home as collateral.
Purchase Contract
Your purchase contract spells out the terms of your agreement to buy a home and details what's necessary to close. Since both the buyer and seller sign the purchase contract, it's a legally binding agreement.
Records of Home Renovations
Contracts, invoices and receipts are helpful documents to hold onto when renovating your home. If the work isn't up to par or something breaks, you can check the paperwork for remedies.
Keeping home renovation records helps you prove the value of what you’ve added if you later decide to sell your home.
Home Inspection Report
A home inspector evaluates the condition of your home. The home inspection report details the house's condition, including items that need repair or replacement.
Home Warranty
Keep copies of any service contracts taken out on your home that cover the cost of significant repairs or replacements. When you buy a home warranty, you want the details of what it covers and how long it lasts.
Should you purchase a home with appliances or major systems under warranty, you’ll want details about the coverage and when the policy ends.
Closing Disclosure
You receive a detailed disclosure of your mortgage terms before closing. A closing disclosure includes the specifics of your loan, like the interest rate, fees and length of the mortgage.
Seller Disclosure Document
A seller documents any issues they are aware of on a disclosure statement. A seller may disclose such issues as material hazards or structural defects.
Reasons to Keep Your Mortgage Documents
Keeping your mortgage documents in a safe location can prove to be invaluable for many reasons, including:
- Taxes: When you buy your home, you might be able to take advantage of tax credits or deductions. Make tax time easier by holding onto mortgage related documents.
- Prevent disputes: Your mortgage documents can prove invaluable in a dispute. If the lender didn't record your mortgage correctly or someone challenges your title, you have the documents to back up your claim.
- Resolve issues: If you encounter issues with a major system under warranty or need to file an insurance claim, you may need to refer to your mortgage documents.
How to Safely Store Mortgage Paperwork
Important mortgage documents should be kept in a secure place. If you plan to keep these at home, consider placing them in a locked, fireproof and waterproof safe to avoid damage.
If you plan to keep these documents at home, consider placing them in a fireproof and waterproof safe so they won’t be damaged by the elements. You can also store mortgage documents in a safe deposit box at your bank.
Keeping hard copies of such legal documents is a good idea. Still, you could also maintain a digital copy on a hard drive or in the cloud.
How to Handle Lost or Damaged Mortgage Documents
If your mortgage documents are lost or damaged, it may be possible to get copies. Many title companies and lenders keep digital copies of legal documents.
Getting a physical copy may be trickier, but it’s not impossible. You could contact your lender, the attorney who settled your closing or the county recorder’s office.
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Cut Back the Clutter and Keep Only the Mortgage Documents You Need
The paperwork involved with a mortgage may prove helpful when you file your taxes, make repairs or pay your mortgage. Knowing which documents to keep and which to toss can keep your financial records manageable.
Frequently Asked Questions
Can I get rid of old mortgage statements once the loan is paid off?
Since mortgage statements change after every billing cycle, storing them for an extended period may not be necessary. If you pay off your home, you should keep important documents, like closing statements and mortgage notes until you sell the home.
Can I store mortgage statements digitally instead of keeping paper copies?
You can keep digital copies of your mortgage statements. You could download the statement online or scan your physical copies. Digital copies can be stored on your hard drive or in cloud-based software.
Should I keep mortgage statements separate from other financial records?
Your monthly mortgage statements are similar to other bills you might receive. You can keep these statements with other financial records. However, it’s helpful to organize your records to make them easy to find. However, you should keep mortgage documents like your closing statement or note, away from everyday financial records.