How long should you keep your mortgage statements?

It makes sense to keep your mortgage paperwork, just in case you need it for tax or legal purposes. But what exactly is essential to keep? And how do you know how long to keep mortgage loan statements? Read on for answers.

What are mortgage statements, and why do they matter?

A mortgage statement, also known as a billing statement, details the status of your loan and informs you of the amount due and the due date for your next payment.

Mortgage statements are sent monthly by your lender and usually include your account number, property address, and current loan balance. It also may list your year-to-date payments and totals paid toward principal and interest. It also may include a summary of your escrow account, including how much you’re paying into it, any payments out of it, and the current balance.

Aside from informing you of the status of your loan and when your next payment is due, billing statements may also include information on loan refinancing, itemized expenses for tax purposes, or instructions on filing disputes.

How long should you keep mortgage documents?

Some mortgage documents are important enough to keep indefinitely, as you could need them even decades later. Others are less important and may be discarded when no longer needed.

The IRS recommends these time frames for keeping specific mortgage documents:

What mortgage documents can you safely discard?

In most cases, you can safely shred monthly mortgage statements when you receive your annual statement or after you verify that your statements match Form 1098, which is provided by your lender and shows how much mortgage interest you paid. Keep any tax records for at least 3 years after you file your income taxes.

To be on the safe side, you can keep tax and mortgage-related documents for 7 years, which is the IRS's time frame for audits. The same applies to home purchase documents, such as the loan closing documents, the home appraisal, and the home inspection report.

Before shredding any documents, look for any notes you’ve written on them that may be important. You can choose to keep that document or write down the note elsewhere. Checking for any discrepancies, such as an incorrect loan or escrow balance, also is helpful when you contact your lender to correct them.

Storage guidelines for different types of mortgage statements

When it comes to storing your mortgage documents, you can shred or store your documents depending on whether they’re physical or digital copies.

For example, with mortgage statements, many lenders allow you to receive electronic statements, which can be stored on a hard drive or secure cloud storage service. Consider naming the digital files according to the date on the mortgage paperwork and the contents of each file. That will help you find what you need quickly.

If you receive paper documents, you can scan them as a backup. Physical documents are best kept in a secure location, such as a fireproof safe or lockbox. Safe-deposit boxes are another option.

Take care when disposing of mortgage records, as they contain sensitive information. Though it may not happen often, someone could find your personal and financial data and use it to steal your identity.

A safer way to dispose of physical documents is to shred them, which can be done either by yourself or with the assistance of a professional shredding service.

When might you need old mortgage records?

You’ll most likely need old mortgage documents if you sell or refinance your home. Such documents can help with details you may need when listing your home for sale, or to proof you own the home free and clear if there’s an unexpected title claim.

Even if you don’t sell or refinance your home, mortgage documentation can come in handy when you need to cancel private mortgage insurance or encounter title issues. It also can help you qualify for tax deductions.

Keeping proper records can save you time by helping you resolve quickly any disputes or problems that arise.

FAQ

Here are answers to common questions about how long to keep mortgage statements.

Can I throw away old mortgage statements after refinancing?

It’s best to keep your old mortgage statements and closing documents from your original loan. At least, until your new loan is fully settled. The maximum you may want to keep them is 7 years, which is the IRS’s time frame for tax audits.

Is it OK to scan and save mortgage documents digitally?

Yes, it’s safe to scan and save your mortgage documents. If you choose this route, name your documents clearly so that you can easily understand their purpose. Creating backups ensures that you have multiple copies in case any get lost. When using cloud storage services, make sure the company uses security protocols.

What should I do with old mortgage documents I no longer need?

You can shred mortgage documents you no longer need. With digital documents, you can delete them. With physical documents, you can shred them yourself or pay a shredding company to dispose of them safely.

How do I know which mortgage documents are tax-related?

Tax-related documents include annual mortgage summaries, escrow statements, and lender-issued tax documents such as Form 1098.

Do I need to keep documents if I sold the house years ago?

Yes, you should keep them for at least 7 years. Especially so for documents tied to the home closing and mortgage payoff, in case of any future legal or tax inquiries.

The bottom line: Keep what matters

While you don’t need to keep all mortgage paperwork forever, keeping some documents is essential for financial security and to protect you legally. Taking the time to review your documentation and organize it in a way that makes sense to you is worthwhile. So is taking the time to research safe ways to store documents, whether that’s a fireproof safe or a secure cloud storage service.

If you’re considering selling or refinancing your home, Rocket Mortgage^® can help you figure out what documentation you’ll need.