5 Things You Need To Know Before Applying For A Mortgage.
Updated: Jul 14
Are you a First Time Buyer looking to get on the property ladder? Here are some top tips for you to follow when applying for your mortgage.
If you need professional help to find the best mortgage suited to you, our team can help you today.
- The more you save for your deposit you will be at a greater disposal of choices of mortgages when it comes to buying your new house. Although there are lenders, currently, that will lend with 10% deposit
1. Budget Is Everything!
Taking out a mortgage is one of the biggest finical commitments you will come across, you need to be fully prepared before finally committing to the mortgage. It is essential for you to sit down and work your budget, this must be the first thing we will do with you. Establishing your budget will help you to understand how much you can borrow to cover the purchase of your property. From here we can calculate how much money you will have leftover to cover all associated costs of buying a house.
Your mortgage repayment will all be dependent on the amount you want to borrow, including interest. Each lender is different using their own mortgage calculators. This is where we can help
2. Your Credit Score Matters.
Before applying for a mortgage, we would advise you to be aware of what committed outgoings that you have. A copy of your credit file would be a good idea, however not essential. Knowing what you pay on credit cards and loans will help us achieve the mortgage you need. A good record is important as it will boost your application. Although we can help you if you have had any issues in the past
To boost your credit there are plenty of simple things you can do to give yourself a better chance of improving your score. This can be as simple as closing accounts you no longer use. Registering on the electoral roll is very important – this will help a lender find you
Websites such as Experian or Equifax will help you to gain a greater understanding of your credit report.
Contrary to popular belief, not all mortgages require a long term employment history. Some will consider even when you have been in employment for a month. If self-employed then you may need to have at least 1 years trading accounts or self-assessment. This is dependent upon your occupation. However, I would suggest talking to us as criteria are ever-changing and we will be able to advise you the most appropriate way.
4. Proof of Income.
Lenders will always seek proof of income when applying for a mortgage. This is crucial in the application as we need to ensure that the mortgage is affordable, and that the lender is happy to accept.
All lenders will need proof of income, each lender will require differing amounts of proof. So will include payslips, P60, and Bank statements. This will give us an insight not only to your income but your outgoings too which will assist us in making correct recommendations and ultimately the lender agreeing your new mortgage
If self-employed then you will need at least 1 years full trading accounts, subject to your occupation. If self-employed and looking for your first home please contact us today.
5. Shared Ownership.
If you’re a first-time buyer and currently looking to buy your first home, a shared ownership scheme has been introduced to make the process of buying your home much more affordable. This will give you the opportunity to purchase a share in a newbuild or resales property.
In addition to this, over time you will have the opportunity to increase your share of the home, this is called Staircasing. More often than not, over time you will gradually increase your share of the mortgage and eventually end up owning 100% of the property. This is an affordable op[titon for you to take when buying your first home.
For any further information about applying for a mortgage get in touch with our team here at Winstree Financial Services to find out all there is to know. If you are looking for a Mortgage Advisor in Colchester our team can help you today. You will be paying off the share you have in the mortgage and then you will pay rent to cover the remaining of the share. This means that your deposit will be much lower in comparison to buying a home outright.