Mortgage matters – buying a home, have you got everything in order?

May 08

Securing a mortgage can be tough, and if the papers are to be believed it is about to become even more challenging. A great credit history can be pivotal to arranging the help that you require, but even some of those with exceptional ratings have struggled to convince lenders to support them in the past. The irresponsible lending that contributed to the global economic crash has led to a significant tightening of mortgage rules, so how can you get everything in place for a successful mortgage application? You’ll find detailed information about applications at Experian Mortgage Matters.

Proof of income is essential in mortgage applications, and if you are employed it’s a wise idea to wait until you have been at your workplace for at least twelve months before you start to seek funding. Those who are self-employed are regularly advised to supply at least three years’ worth of accounts before proceeding. Obtaining a copy of your credit report is also essential, many people have been turned down due to errors on their reports, but you can ask for something to be amended if it shouldn’t be there, thus heightening your chances of acceptance.

Clearing debts beforehand

Affordability is about to become more important than ever, so you shouldn’t be swayed purely by a low price tag. You’ll have to think about the council tax band you’ll be in, interest rates, stamp duty and the chances of falling into negative equity based on the area that the property is in. If there is a big risk of this occurring, expect to find it tougher to get lenders to cooperate. You will also have to supply a detailed breakdown of your monthly expenditure as well as information about existing debts too. If you do have balances on credit cards, it’s wise to clear them as much as you realistically can before approaching a lender in order to enhance your credit rating. You may also be asked about future plans such as having children or retirement.

There are many factors that could affect the amount that lenders are willing to offer. It’s a good idea to tighten your wallet during the months leading up to a mortgage application to demonstrate good financial etiquette. It’s predicted that the new changes will result in fewer mortgages being offered, so putting a good case forward has never been more important.

If you cannot afford the conventional 10% deposit, the government’s ‘Help to Buy’ scheme may be a useful channel, particularly if you’re not in a position to ask family members for assistance. This model allows you to only lay down a 5% deposit. It’s a good move to shop around to get the best solicitor that you can afford. They’ll be dealing with all manner of paperwork and other legalities on your behalf once you are ready to make an offer on a home. Don’t forget to enlist the help of a surveyor either as you will need to verify the condition of any home you’re interested in before you move forward.