HOPING TO BUY YOUR FIRST HOME? APPLYING FOR A MORTGAGE DOESN'T HAVE TO BE COMPLICATED. HERE, WE'VE GIVEN OUR TOP TIPS TO HELP YOU TO FIND AND SECURE THE RIGHT MORTGAGE FOR YOU.
5 things you should do before applying for a mortgage
Before applying for a mortgage you’ll want to do everything you can to look good in the eyes of lenders. This will not only increase your chances of getting approved for a mortgage, it may also help you access better deals and rates.
1. Save for a good-sized deposit Although there are all sorts of mortgages out there, you’ll put yourself in a stronger position for getting the best rates the bigger your deposit is. For example, the interest rates are usually lower if buy your new home with a 25% deposit and 75% mortgage, compared to a 20% deposit and 80% mortgage.
2. Check your credit report Before you apply for a mortgage it’s always a good idea to check your credit report first. There are three credit reference agencies that lenders use so it’s important you check your report on all three as the information in them can sometimes differ. This simple check will help you spot any mistakes on your report and give you time to correct them, or if your credit score is a bit low, you can take steps to improve it before you apply.
3. Register to vote Identity checks are part the mortgage application process so it’s really important you’re on the electoral role before you apply. If you’re not, your application could fall at the first hurdle.
4. Know your budget – and stick to it When you first start searching for your dream home it’s tempting to stretch your budget as far as it can go. So, before you start it’s worth deciding exactly how much you can afford – in terms of your deposit, house price and monthly mortgage repayments.
5. Get a mortgage in principle Although a mortgage in principle is not a guarantee of getting the mortgage (you still need to apply for it officially) it does give you a good idea of how much you can expect to borrow and therefore how much you can afford to spend on your dream home.
Before you apply it’s also worth getting specialist advice from someone experienced in new build homes because lending limits often differ from resale.