10 ways to maximise your chances of getting a mortgage
We’ve pulled together 10 top tips that will help give you the best chance of being accepted for a home loan.
1. Save the biggest deposit you can
Mortgage suppliers hold their least interest rates for individuals with large stores.
That means a large portion of the top deals on the market are restricted to buyers who can put down somewhere in the range of 35% and 40% of a property’s value, while those with just 10% to put down should pay a higher rate.
At the end of the day, save up as a lot of store as you can. In case you’re a first-time purchaser, a Help to Buy ISA can be a decent starting point.
2. Avoid surprises by knowing your credit score
You will require a decent credit score to qualify for the best mortgage deals. You can check yours for nothing with Our Credit Monitor or MoneySavingExpert’s Credit Club. Both of these administrations are totally free and utilize a ‘soft check’, so they won’t affect your credit score.
Checking your credit score means you can make certain to avoid any amazements and it will also give you an opportunity to address any inaccuracies should you discover any.
3. Pay off unsecured debts and close any unused accounts
When choosing whether or not to take you on as a customer, mortgage lenders will look at the total amount of credit available to you – as well as the amount you owe.
So clear as a lot of your debt as conceivable and close down any accounts you never again use. Something else, lenders may be worried about your ability to keep up with your mortgage repayments.
4. Get on the electoral roll and update your address
Many companies utilize the electoral move to confirm your character, so your mortgage application may well be can’t in the event that you are not enrolled on the electoral move at your current address.
This is easily helped, however. Simply contact your Local Authority and ask for a registration shape or sign up online.
To avoid any issues, it also makes sense to guarantee the address the credit agencies have for you is cutting-edge.
5. Avoid unusual properties
Mortgage lenders like knowing that they can recover their money should you default on your repayments, for example.
Consequently, they are often less ready to loan against properties that are considered to be unusual and may in this way demonstrate harder to sell on.
Properties in this category – and accordingly best avoided – incorporate flats above commercial premises, for example, cafes and bars, old or unusual buildings and homes manufactured utilizing non-standard construction materials, for example, cement or steel.
6. Be prepared with all documents
No mortgage lender will take you on as a customer except if you can demonstrate what your identity is, so make sure you have a modern passport and that the address on your driving permit is right.
Different records you should give incorporate an ongoing letter – from say a bank or service company – that demonstrates your address.
Utilized workers will also have to obtain their bank statements and payslips throughout the previous three months and their P60s throughout the previous two years, while the individuals who get a reward must give proof of this as well.
The accounts or HR department at your company ought to have the option to give duplicates if necessary.
On the off chance that you get any other pay, for example, Child Benefit, you’ll also require reports to demonstrate this.
7. Collect evidence of self-employed earnings
Independently employed workers make lenders apprehensive, and must give considerably more proof of their earnings than those with all day occupations thus.
On the off chance that you are independently employed, you will in this way need a SA302 structure relating to the last a few years from HMRC, or your full accounts for the last a few years.
8. Know in advance the kind of mortgage you want
Mortgages come in all shapes and sizes.
You consequently need to choose whether you want the security of a fixed rate, for example – yet that will also lock you in for the entire term – or settle on a tracker deal which may not accompany tie-ins and could even start off cheaper, however will ascend in line with the Bank of England base rate.
Mortgage lenders will factor in potential interest rate rises when working out your affordability, yet on the off chance that you have any worries that you wouldn’t have the option to manage an increase in repayments, a fixed rate deal is the safer option.
9. Shop around or use a broker
When you have chosen what kind of mortgage you want, the subsequent stage is to make sure that you get the best conceivable deal for your circumstances. After all, finding the cheapest deal could save you thousands, if not many thousands, of pounds over a 25-year term.
Our mortgage channel at MoneySuperMarket gives you immediate access to details of all the top deals for everybody from cash-strapped first-time buyers to movers with stores of £100,000 or more.
Notwithstanding, it also makes sense to check with a broker as they can offer a few deals that are not available direct. London and Country’s advice administration will assist you with finding the correct mortgage, giving you peace of mind that you made the correct decision for your own particular circumstances.
10. Don’t chop and change your application
When you’ve started your mortgage application, don’t start playing about with it by changing figures (for example, in the event that you choose you want to acquire more money) as this can cause hold ups.
Not exclusively could the lender won’t give you the extra money, it may choose it’s never again prepared to loan to you at all.