How Long Should You Keep Mortgage Statements​?

At BrickWood Mortgage, we assist home buyers with various home loan issues daily. Among the most popular queries we encounter relates to the necessary paperwork. After you buy your first house, a constant flow of papers starts to arrive either through the mailbox or by email. Among the most prevalent documents to be expected are your monthly statements showing your outstanding balance, interest payments, and escrow account. When receiving documentation from a South Carolina mortgage lender, it’s important to know what you need to file away. 

Know how long to keep mortgage statements or whether you have to keep all the documentation your lender sends you? An accumulation of piles of paper in your home office can become a real problem and source of stress for you. Although switching to online billing and payments may seem like the best solution, knowing how to organize and manage the paperwork is crucial.

In order to ensure your financial stability, you need to know how to sort things out. Proper record keeping will prevent you from having troubles in the future as well as make the process more efficient. So, how long should I keep mortgage statements? Tax season, loan renewals, and/or dispute settlements will go smoothly if you keep your financial documents organized.

Guidelines for Storing Paperwork

From the legal perspective, document retention is strictly controlled and regulated. According to the Internal Revenue Service, all tax returns should be kept for at least 3 to 7 years. Your monthly statements should be stored for the same period as well since they affect your tax return. If you are unsure how long to keep mortgage loan statements, the reasons behind this recommendation are simple – you can include the mortgage interest deduction and property taxes paid into your expenses.

Banks, credit unions, and other financial institutions are strictly regulated concerning record keeping. Usually, financial organizations keep loan documents for several years after loan repayment. Nevertheless, the only person who needs access to them is you. Relying on the bank to retrieve some data after seven years means losing plenty of time. Mergers, acquisitions, and other changes might complicate the process. As mortgage brokers, we recommend creating your own storage for financial statements and understanding how long to keep mortgage documents.

Why Do You Need to Save Your Paperwork?

You need to store your financial documentation not only for compliance with tax agencies. Every statement you keep becomes a proof of your payments to the lender. Sometimes, there could be some mistakes related to improper payment allocation or incorrect reporting. Having the statement proves that everything is correct and helps protect your credit history.

At the same time, you may need them in case you consider buying another house or refinancing your existing loan. We may ask for your mortgage statements during our consultations related to buying a new house. In this way, we can easily check your financial situation and help you get better interest rates.

Besides, when you plan to dispute an escrow payout, you can prove it using your yearly statement. Another important thing to remember is that your monthly statement includes sensitive information. Tossing all of them into the bin becomes extremely risky for your financial security. That is why, knowing exactly what papers you possess will help you properly shred all unneeded documents.

Our Recommendations for Storing Documentation

The matter of timeframes for storing monthly statements deserves more consideration. Thus, we recommend retaining them for one year. The moment you get your annual statement summarizing all payments, interest, and escrow payouts of the previous year, you can shred your monthly statements.

The annual statement, on the contrary, should be saved for at least seven years after you filed your tax return. In case of selling your home or paying off your loan, it is better to keep the payoff statement indefinitely. This statement proves the fact that all your debt was paid back successfully.

FAQs

Can I download all statements online?

Of course, digital copies are more convenient and safe. We recommend you to download statements and save them to your computer or a cloud server.

What do I do if I notice an error in my monthly statement?

We always recommend calling or writing to your loan servicer and describing the situation clearly. To avoid any misunderstandings, we recommend sending a letter with your explanation and keep a copy of this letter together with the statement.

Do I need to save my monthly statement after selling my home?

Yes, you definitely need to save the last annual statement and payoff confirmation for at least 7 years.

Secure Your Finances

Home loan management is not complicated if you know how to handle your monthly statements properly. Retaining your monthly statements for one year and annual statements for seven years will create a protective layer of your financial assets. Proper paperwork will make dealing with tax agencies and refinancing easier.

As experienced mortgage brokers, we are always ready to assist you with home loan management at BrickWood Mortgage. Our team will help you understand the specifics of your monthly statements as well as give a professional opinion on the best strategies. To make an appointment for a consultation, call us right away!