Tips for getting a mortgage
Are you a first time buyer or simply looking to move home or do some home improvements. With the introduction of MMR from the end of April there is greater emphasis on lenders to ensure that you can afford their products. This means that no doubt their qualifying rules will become more complex. Additionally you may find that to get a cheap rate you will need a larger deposit. The schemes available now benefit those who require a low loan to value. For first time buyers the help to buy schemes will help but shop around as you will find that borrowing 95% loan to value compared with say 90% loan to value could be a lot more expensive.
Understanding how lenders assess you for a mortgage will greatly help your chances of getting a loan.
These are some useful tips for getting a mortgage at possibly the lowest headline rate commensurate with your income and deposit.
- Ensure that you are on the electoral register
- Do not miss any payments on any of your financial commitments such as utilities and credit cards. Missed payments will count against you.
- If you have any debt, reduce it as much as you can. By doing this you may be able to borrow more than you originally thought.
- Do not apply for credit at the same time that you apply for a mortgage.
- Ensure that you can prove your income by keeping pay slips and P60s. Proper accounts if you are self-employed.
- Make sure that you have a good credit rating and if you are unsure about what your credit rating is then you should obtain a record of your credit history from one of the credit rating agencies.
- Make sure that you understand and can fulfil lenders’ criteria.
The above is relevant whether you are applying for a mortgage to purchase a property or re-mortgaging your existing property.
Whether you re-mortgage depends on the deals available from you current lender and rates available from other lenders. You may also want to consider a secured loan especially if you have some preferential terms with your lender and they will not lend you anymore money.