Organize Your Important Documents to Simplify the Home Buying Process

Buying a home is exciting, fun, significant, and stressful. In fact, the American Institute of Stress reports that taking on a mortgage is one of the top twenty most stressful things in life, and making a major change in your living situation is within the top thirty on the Holmes-Rahe Life Stress Inventory. When buying a home, there is obviously much to enjoy and look forward to in the process, but there are also a lot of tasks involved that will probably leave you worrying. Therefore, being as organized as possible can greatly reduce any annoying and unnecessary frustrations you may encounter.

If you cannot find an important document that you need in order to move on to the next step of buying a home, you not only could wind up extremely stressed, but you may not even be able to move on at all. In order to help you be super prepared for presenting every record that the home buying process requires, Chris Doering Mortgage recommends installing a simple and efficient system of arranging and taking care of your documents. Adhering to the following advice with all of your essential paperwork will not only help you avoid unhealthy stress levels, but it will also help you cut down on home buying hassles in general.

How to Organize Your Important Documents

  1. Gather and Group Your Documents

As soon as you can in the home buying process, you should collect every important document you have, or even every document you have. Search all throughout the house, bring papers home from the office, get stuff out of storage, and contact any family members who may be holding things for you. Examples of important documents include:

  • Birth and death certificates
  • Marriage licenses
  • Social security cards
  • Passports
  • Wills
  • Medical records
  • Real estate documents
  • Insurance policies
  • Automobile documents
  • Credit card documents
  • Investment documents
  • Loan documents
  • Banking records
  • Tax records
  • Transcripts and diplomas
  • Monthly bills and receipts
  • Warranties and manuals
  • Home maintenance receipts

When all of your documents are in one place, begin to sort them. To start, put them into piles based on their order of importance. Obviously, things like birth certificates and social security cards will always be a top priority, while tax records and transcripts may have a slightly shorter shelf life of importance. Therefore, group these documents accordingly, and trash whatever you can to eliminate clutter. How do you know what you can toss? This list holds some of the answers:

  • Bank statements: If you have not yet chosen to switch to paperless statements, then keep the hard copies of your bank statements for three years. For the future, consider going green by utilizing the practicality and expense of online banking in order to spare the environment and your home of excess paper.
  • Credit card statements: first, check the accuracy of these statements with your own records. Make sure that any large purchases are accounted for, and then make a copy of your statement so that you have proof of your payment. Then, especially if these documents have any identifying information on them, shred them rather than throwing them away in order to lessen your risk of identity theft.
  • Tax returns: In general, you should keep tax documents for seven years, but depending on the taxed activity they display, you may want to keep them for longer.
  1. Find a Simple Filing System for Your Documents

Once you have separated your documents into groups based on importance, further systemize these groups according to some order, whether alphabetical, chronological, or whatever makes the most sense to your family. To keep your smaller and larger groups together but still distinct, consider putting all documents relating to one particular category into a file of a primary color such as blue or red, and then use lighter and darker shades of that same color to break that category down more specifically. For instance, all documents having to do with money could go in a green holder, and then within that holder, tax documents could be kept in the mint section, loan documents in the forest section, banking records in the emerald section, etc.

Even if you choose to use something other than colors to classify everything, if you have a lot of documents, getting as organized as possible with categories and subcategories is key to stress-free discovery and delivery. Also, just so you don’t forget your system, create a file index with a table of contents so that you do not accidentally duplicate or misplace any documents.

  1. Protect and Preserve Your Documents

Some of your most important documents will entail extra special attention and care, so make sure that you take the necessary precautions to protect them. For documents that would be very difficult to replace, such as your birth certificates, passports, social security cards, and wills, keep them in a fireproof lockbox or a lockable filing cabinet. This may sound intense or even somewhat risky, but at least all of your most crucial paperwork will be sheltered and secure.

For many of your documents, you will not need to keep the hard copies. For these items, go digital when you can. If you do not already have a digital record of a document, then make one by scanning it. Then, store all of your digital files on an external hard drive or a cloud server. If you choose to use a cloud, go with a storage provider that offers data encryption for your very sensitive stuff, and also opt for more than enough space to meet your needs.

  1. Put Your Documents in an Accessible and Attractive Place

Now that everything is compiled and cataloged, house it all in a spot you can access effortlessly, but feel free to make that space look as neat, lovely, professional, or pretty as you want. Organization does not have to be boring or unattractive, and there are plenty of cute and creative storage ideas out there from which to choose. Do store your documents somewhere safe and aesthetically satisfying within your home, but do not carry them around in your wallet or purse. That is a very bad idea, as doing so increases the chance of an essential document such as your passport or social security card being stolen.

How to Simplify the Home Buying Process

Certain personalities will find this part of the home buying process rather relaxing, refreshing, and even reassuring, but for those of us who do not relish this kind of organizing, there is always the payoff of convenience and efficiency to come, and that feature means that a great amount of anxiety will not be making an appearance when you are buying a home. There are not really any setbacks to getting as organized as possible before taking on such a major and somewhat daunting task, so consider cutting down on the hassles of home buying by starting to take these steps today.

At Chris Doering Mortgage, we are also committed to cutting out the stressful hassles of home buying, and that is why we offer simple tips such as these as well as expert, professional, and friendly mortgage lending services. Contact us today to learn how our team can supply their support to help you move through the home buying process with ease.

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