It couldn't be simpler…
But by doing these 10 things you will:
- Improve your chances of getting a mortgage
- Save you money
- Save you time
- Reduce stress
Let’s look at each one in turn…
Check your credit rating
There are a number of credit agencies that provide free trails to see you credit score. One example being Experian.
Take advantage of these services to see what your current credit rating is and see if there are any problems that you were unaware of.
They will give you guidance and advice to improve your credit rating and correct any errors.
Set up automatic repayments on your credit card
We all get busy and forget things…
However missing a payment on your credit card will affect your credit rating and can affect the amount a mortgage company will lend you.
Set up a direct debit on your credit cards to pay at least minimum payment each month, even if you then pay more off of the card.
If this minimum payment is automatically paid then it does not show as a default and will keep your credit rating clear.
Make sure your name and address is correct on documents
- Driving Licences
- Bank Statements
If you have moved address or changed your name, get these documents changed to your new details. You will be asked for various documents from both the mortgage lender and the solicitor.
If these documents are wrong this could cause hassle and delays.
Get your documents together before applying
You will need various documents to assess your application.
Not having these documents is one of the most common causes for delays in getting a mortgage.
These are the common documents to have:
- Driving Licence
- 3 months payslips
- Up-to-date statement of entitlement for Child Benefit
- Up-to-date statements for other state benefits
- 3 months bank statements (showing your salary/income going into the bank)
- Latest mortgage statement (if a current mortgage exists)
- Proof of deposit
- If the deposit is being gifted you will need a letter from the person gifting the deposit (speak to your financial adviser for the exact wording required)
- If Self Employed:
- 3 Years accounts ‘signed by accountant’
- 3 years SA302’s (these can be got from your accountant or directly from HMRC)
- 3 years tax overviews (these can be got from your accountant or directly from HMRC)
Take Independent Advice
Independent Financial Advisers are not restricted to one mortgage lender.
They can view the whole market. This means they are able to find the lowest cost mortgage for you.
Not only this, they are able to assess your information against each lenders criteria to ensure that you are applying for the right mortgage.
This can help you save a substantial amount of:
Make a list of the last 3 years addresses, together with moving in and out dates. When an application is assessed this will be needed to see your credit history.
Make a list of all credit agreements that you have:
- Credit cards
- Hire purchase
- 0% interest on sofas/furniture
- Store cards
List down the:
- Account number
- Amount owed
- Term left
- Monthly repayment
If this information is input wrong into a mortgage application it can cause delays and can give you false results, which may cause you problems later!..
Keep Out of Your Overdraft
If possible, get out of your overdraft and keep it in the black leading up to a mortgage application.
This will help improve your credit rating and also show good financial management to a mortgage lender.
Give the Right Figures
When talking with a financial adviser, don’t guess at your figures.
Any decision being made for a mortgage is only as good as the figures being input. If the figures are different than your documents then this could change the decision being made.
Be Critical of Your Payslips
Mortgage lenders assess your personal situation in different ways.
You may have deductions on your payslips.
- Childcare vouchers
- Pension contributions
- Ride to work schemes
Your adviser needs to assess these figures, as where one lender will look at your income without these deductions, another will use the lower figure after deductions.