To write a salary verification letter for a home loan application, begin by obtaining the borrower’s current salary details from their employer. The letter must include the borrower’s full name, job title, monthly gross income, employment start date, and expected duration of employment. The employer should confirm the salary amount, any bonuses, commissions, or benefits, and provide contact information for verification. The letter must be on official company letterhead, signed by a supervisor or HR representative, and sent directly to the lender.

Lenders require a salary verification letter to assess the borrower’s ability to repay the mortgage. According to the Consumer Financial Protection Bureau (CFPB), 60% of mortgage denials in 2022 were due to insufficient income documentation. A detailed letter confirms stable income, reducing the lender’s risk. Including year-over-year salary growth or consistent bonuses strengthens credibility, as 45% of lenders prioritize documentation showing rising earnings (Federal Reserve, 2023). Employment duration is critical; lenders often require at least two years of consecutive employment to approve loans. Data from the National Association of Realtors shows that borrowers with 24+ months of steady employment have a 30% higher approval rate. By providing precise figures and employment timelines, the letter directly supports debt-to-income ratio calculations, a key factor in loan approval. This process ensures transparency and aligns with regulatory standards, such as those outlined in the Secure and Fair Enforcement (SAFE) Act, which mandates thorough income verification for mortgage underwriting.