Many people find the prospect of a mortgage application to be a source of stress, and although that’s understandable because a dream move is often riding on a successful outcome, it doesn’t necessarily need to be the anxious time that people expect.
There are two key things you should be doing to give yourself the best possible chance of submitting an application that’s likely to be successful.
Start preparing early
If you know you’re likely to want to move, then getting all your ducks in a row in terms of financial information that your lender will need is always going to serve you well.
Waiting until you’ve found the house of your dreams to start your mortgage planning is always likely to be a more stressful experience because you’re immediately competing against the clock and running the risk that another buyer will be in a more advanced position to complete a purchase on the property you’ve set your heart on.
Talk to a professional mortgage adviser
Although it’s tempting to use one of the many online comparison sites to choose and then apply for your loan, it’s unlikely you’ll find the very best deals available as there are some products that might not be accessible to you.
And unless you really know the sector, you may not be in the best position to decide which of the many mortgages that are available to you is the right one for your circumstances today and in the future.
What information do you need?
One of the keys to a successful mortgage application is having the right information to begin with, which is why when we sit down with a client to look at their mortgage needs, we as them to provide us with a fair amount of information about their financial situation.
Having detailed information serves a number of benefits.
First, it means your mortgage adviser will have a broad overview of your financial situation and will be in a better position to be able to guide you to a mortgage that will secure the property you want without you having to overreach yourself financially.
After more than a decade of austerity, stricter lending criteria together and a more circumspect and prudent approach to lending by banks and building societies, we are now in a more competitive environment where lenders still apply rigorous affordability but are in many cases prepared to offer higher salary multiples than they were a few years ago.
But as a borrower you need to remember that while securing a mortgage is one thing, paying for it is another.A prospective lender may not know, for example, that you’re thinking about starting a family, or buying a second home or going on around the world cruise. But by sharing your plans with your mortgage adviser, he or she can build that into their thinking as they talk through your options.
Most lenders may want, as a minimum:
Copies of your passport or driving licence to prove your identity
Proof of address (this is usually a formal document such as a utility or bank statement)
Between 3 and 6 months of bank statements from all your accounts (if you have more than one)
Proof of all your income, including overtime (this will usually be your P60 if you’re employed, or a minimum of two years of audited accounts if you’re self-employed or run your own business)
Details of your existing debts (credit cards, loans, HP agreements, store cards etc.)
Your tax history for at least two years. If you’re self-employed or have income from more than one source, this will usually be the SA302 tax return form
A breakdown of your monthly financial commitments – this will include motoring expenses, regular childcare commitments, personal and property insurance policies, utility and phone costs and any other costs which the lender might reasonably expect you to have to continue to pay during the life of the loan.
It’s important that your mortgage adviser knows as much about your financial situation as possible.
If there are potential problem areas in your finances that might be an issue for your prospective lender, it’s better that you and your mortgage adviser are aware of them so you can identify the right mortgage strategy from the start.Being blindsided by those issues coming to light during the lender’s credit checks not only delays the process, but it may jeopardise your application completely.
At Oportfolio, we ask you to provide all of that information before we sit down with you so that we can all make the most of the time we spend together and get the application process moving quickly.
But once you and your mortgage broker have a clear picture of where you need to head, you should then be able to leave your broker to see the process through from start to finish, while you get on with the important things in life.
Being prepared has another advantage, too. Mortgage offers are valid for between 3 and 6 months, depending on the lender, so if you have your loan in place before you start house-hunting, you’ll be a much more attractive proposition for estate agents and sellers alike.
If you’re thinking of moving this year, why not get in touch and see how our friendly team can help you into your dream home?
Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct Authority
Your property may be repossessed if you do not keep up repayments on your mortgage.
Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage/further advance fee of £395. Our product transfer fee is £295.