Man signing papers

Tax season is the perfect time to sort through your paperwork to make “keep” and “shred” piles.

But when it comes to mortgage documents, which do you keep, and for how long? And which can you safely toss?

IRS Could Ask for Proof

As a rule of thumb, you should keep all of the contract papers detailing your home purchase and original loan for the life of the loan.

And sometimes longer.

Since home loans can have tax implications, the IRS provides guidelines on what paperwork you need to keep and for how long. You could be required to produce records that prove income, deductions or credit claimed for at least three years from the date of a return.

If you failed to file a tax return in any given year, there is no statute of limitations. In that case,  the IRS recommends you keep documents related to those records indefinitely.

You also should keep records of any major home improvements, such as a remodel or addition, and records of expenses incurred while buying and selling, such as legal fees and agent commissions, to calculate capital gains.

A capital gain is a profit that results from the sale of an asset that amounts to more than the purchase cost. Any improvements you’ve made on your house, as well as expenses when selling it, are added to the original purchase price. The difference between the sale price and the original price is the capital gain. Keeping records of these expenses can help lower your capital gains tax.

Other paperwork associated with the loan, such as refinancing agreements, should be kept for at least three years, although some real estate professionals recommend keeping this paperwork for up to 10 years. That’s because you might want to refer to it if your monthly mortgage statements seem inaccurate or if there’s a sudden, unexpected change in your monthly interest rate, for instance.

You’ll need to keep monthly statements, such as those detailing paid monthly mortgage loan fees, only as long as you feel necessary – perhaps a few months – to ensure the payments were credited to your account.

Three Keepers Tied to Your Mortgage

These documents should be kept in a safe place while you still own the home:

Deed

The U.S. government recommends that you hang on to any deeds as long as you own the property. But if you’ve paid off your mortgage, and the deed to your property has been recorded in land records, the documents can be tossed. That’s because most municipalities have copies of these documents available online. Even so, your personal copy is the quickest way to prove that you are, in fact, the owner of your home.

Before discarding these papers, make sure you have a document labeled “release” or “certificate of satisfaction.” You can verify this with the title company that handled your closing.

Mortgage (or Deed of Trust) and Promissory Note 

Much like your deed, you’ll want to keep these documents for at least as long as you own the property. In the old days, homeowners had “note burning” parties at which they torched their mortgages to celebrate paying them off. While that may have been fun, these documents are still incredibly important, and you’re much better off filing them in a storage cabinet.

Closing Disclosure

Consumers should hold on to the Closing Disclosure for at least a year after closing on their mortgage.

The disclosure details the fees you paid to the lender and third parties, as well as whether or not you paid discount points. Under some circumstances, you can deduct discount points from income taxes, but you’ll need to keep the Closing Disclosure for as long as you use the deduction.

Three to Keep Even if You Don’t Have a Mortgage

Even if you’re not signing a mortgage, there is paperwork you should keep until it’s no longer needed:

Purchase Contract and Seller Disclosures

If any undisclosed problems crop up with your home during your first two or three years of ownership, you may want to refer to the contract and disclosure documents to prove that the seller didn’t mention the problems. Keep these documents until you’re confident you’re past the point when undisclosed issues will emerge.

Home Warranty

If you have a home warranty, keep a copy until it’s expired (they’re often annual contracts that would need to be renewed). Checking through this paperwork is the fastest and easiest way to know what’s covered.

Home Inspection Report

You should keep the home inspection report for two to three years, since it’s likely to convey information about the ages and conditions of systems and appliances, among other things. For example, the home inspector may have estimated the age of the roof, which gives you an idea of when it will need to be replaced.

How to Keep Your Records Safe

Online or cloud-based records can be hacked, and hard drives can fail.

We recommend you keep important real estate records in a locked fireproof cabinet or safe deposit box. Make sure to tell any other party named on your mortgage where the files are and how to access them.

If you’re still feeling overwhelmed by documentation, talk to your tax advisor and a Home Loan Expert before heading to the shredder.

This Post Has 28 Comments

    1. Hi Gary:

      I’m going to send you an email just in case you happen to be our client. If your mortgage is through Quicken Loans, we can help you if you can provide your loan number, phone number or the email address associated with your account or application.

      Otherwise, the best way to get a copy of the original contract would be to contact your lender. They should be able to help you.

      Thanks,
      Kevin Graham

    1. Hi Michele:

      The major HUD statements have been replaced by a new loan estimate and closing disclosure under the Know Before You Owe policies put in place by the Consumer Financial Protection Bureau. You would get new documentation with the new loan, so you shouldn’t have to worry about keeping any particular documents related to the old mortgage unless you wanted to for tax purposes or something. Hope this helps!

      Thanks,
      Kevin Graham

    1. Hi Chris:

      I can’t see any reason you couldn’t do that. Even if for some reason your mortgage company or loan servicer needed you to fax in a hard copy, you can still print out a copy and fax it in in that case.

      Thanks,
      Kevin Graham

  1. I was foreclosed on almost 2 years ago. Do I need to keep any of the documents pertaining to the purchase of that house and do I need to keep any of the foreclosure documents? And for how long? Thanks!

    1. That’s a good question, Amy. I’m going to have a home loan expert reach out to you. They’ll help you work through the answer. Have a good Thursday!

  2. I bought a house in 1997 and cannot find the HUD1 statement for it. How do I determine my cost basis without it?

  3. I had a short sale in feb of 2010, I am in the process of buying another home. The escrow officer wants the HUD 1 Settlement, I don’t have it, attorney doesn’t have it Escrow company on sale doesn’t have it? I have a 1999S form from my taxes of that year showing the sale. That’s it What can I do?

    thanks

  4. I too have many years of loan re-finance papers starting as early as 1988 to 2009. Home sold in 2011. Is it safe to shred documents older then 10 years.

    1. Hi Valerie,

      It’s never a bad idea to hold on to your past documents, although they may be a bit dated. However, as the article states, documents associated with a loan can differ by state, so I would suggest getting in touch with a Home Loan Expert here: http://www.quickenloans.com/about/contact

      Thanks for reading!

        1. Hi Krystal:

          You should keep them at least until you sell the property. You might need them for records or to update them to add a spouse or something.

          Thanks,
          Kevin Graham

  5. Do I still need to keep both the purchase and sale records on a home we sold 5 yrs. ago? I understand the logic of keeping all records on the home we currently own but not on one that was sold years ago.

  6. I to have refinanced several times in the last 5 years. Do I need to keep old mortgage statements and old GFE’s that no longer apply? How long do you need to keep the GFE after closing on the current morgage? It seems that this document is just an FYI for the consumer but once the loan closes and is officially documented there is no reason to keep it.
    Thanks
    Julie

  7. I am in the same boat as Alice and James and would like to know if I need to keep previous loan docs from previous refi’s. Thank you.

  8. I was wondering if James Reid who posted on March 15, 2011 at 1:46 pm, has recieved his answer. I am in the same situation. I have a couple of sets of old refinancing papers that I would love to get rid of.

    1. Hi Alice, yes, we contacted James and I’ll share your inquiry with our team and they will reach out to you as well and answer your questions. Thanks and have a great day!

  9. Which real estate forms should I keep from the Initial purchase, several refinancing, and the sale of my home.
    What kind of situation can come in to play that you would need paper work from homes you have already sold?

  10. To whom this may concern,

    If I refinance my house for a 2nd or 3rd time, do I have to keep the documentation for the the prior refinancing.

    Thanks

    JIR

  11. Hi,
    Is it necessary to keep the loan application documents as well as all of the closing documents & statements etc.? The application documents such as good faith estimate, truth in lending disclosure, lock-in disclosure, etc. – after the loan has closed is it necessary to keep all this stuff? Thanks.

    1. Hi Sara!

      The safest bet is to hang on to these documents for at least 10 years. You may not need them, but we’ve found it’s always better to be safe than sorry. You can file them away in a safe place that’s also out of the way so they aren’t contributing to clutter. If you really want to minimize what you have on hand, confirm with your tax or financial adviser before you get rid of any documentation. Thanks for reading!

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