A lot of people have been denied mortgages for a variety of reasons in the UK in the past six months. Not being on the voting list and not having good credit scores are some of the reasons. It’s a bit of stress getting your hopes up only to have it dashed for one reason or the other. Your best bet is to be prepared before applying for a mortgage to buy your home.
Here are some things you should do before applying to a mortgage lender:
- Choose The Right Property: A lot of mortgage lenders are reluctant about lending people money to buy properties that will not be easy to sell if there’s a default on the mortgage repayment. The mortgage lenders need to be assured that the property you want to buy can be quickly sold when you fail to meet up with your payment. Flats which are located above bars or pubs, properties made of unusual construction materials, old and other unusual properties are the types you should avoid.
- Make Sure You Are On The Voting List: If your name is not on the electoral list or the address listed does not correspond with the one on the electoral list, your mortgage application may not be approved. Sign up online or visit the appropriate local authorities for a registration form if you are yet to be listed as a registered voter. It also does not hurt to double check if the address listed matches your current address.
- Try To Save Up As Much Deposit As You Can Before Applying: Mortgage lenders are prone to reserving the lowest interest rates for buyers who can deposit up to almost half of the property’s value.
- Estimate a suitable mortgage type: Find out which mortgage type is best for you based on your earnings using a mortgage affordability calculator. Mortgage rates could be fixed or could vary.
- Have A Good Credit Score: Mortgage lenders will not only check your credit rating, but they will also find out how much debt you owe. Excess debt will make lenders sceptical as to whether you can meet up with your scheduled mortgage repayments. Request for a copy of your credit score from a credit monitoring channel so as to be prepared.
- Have All the Necessary Paperwork Ready: Mortgage lenders need to be assured that you are who you claim to be and the only way to prove that is by having an up to date passport, as well as a valid driver’s license. Bank or utility bills would be used to verify your address. Pay slips and bank statements could be requested if you have an employer and double checked with the accounts department of the organisation. If you are self-employed, you will need your SA 302 forms from two years before.
To successfully get a mortgage, it is important that you present to the lenders all they need to ascertain that you’re worth lending money to. Paying your bills on time and choosing a good broker are also ways of improving your chances of mortgage approval.