25 January 2018

As the New Year starts to gather pace we asked Andrew Milnes from our in House Brokers Mortgage Advice Bureau to give us his thoughts on some of the things you should do if you are considering applying for a mortgage.

As the New Year starts to gather pace we asked Andrew Milnes from our in House Brokers Mortgage Advice Bureau to give us his thoughts on some of the things you should do if you are considering applying for a mortgage.

Tip 1 - Have a look at your Credit Reports

It's important before you begin the process of looking for a mortgage, that you know what is showing on your credit report.

The two main credit reference agencies used by lenders are Experian and Equifax. Whilst both of these may offer a free trial periods www.noddle.co.uk offers a free for life credit report. Just be aware that not all credit agencies hold the same information and that not all lenders use the same credit reference agency (Helpful we know!)

Review the report in detail - identify any credit accounts that are no longer used - for example, historic credit card accounts and ensure that they are showing as 'Closed' on your report. If they are not, contact the provider mentioned to have this actioned. If those 'open' accounts with a zero balance were viewed by a mortgage lender, they could assume that you have access to the credit limit on that account - as a result, this could reduce the 'credit score' on your record.

If you dispute any item showing on your credit record, first of all contact the credit reference agency - they will assist you in contacting the provider. Take a copy of your report along to your meeting with your advisor

Tip 2 - Make an appointment to see a Specialist Mortgage Advisor

Once you have your credit reports, get in contact with a local specialist mortgage advisor to discuss your plans.

Before your meeting, if you are employed, get together your latest three monthly payslips and P60. If you are self-employed you will need your last 3 years SA302 and Tax Year Overview, talk to your accountant if you are unsure of what these are. If you have been trading for less than three years we may still be able to help but please make your adviser aware as soon as possible. Your advisor will also need to see some form of identification (Current Passport or Driving Licence) and some address verification such as a utility bill. If you have them available your last 3 months bank statements will give your advisor a good feel as to how you manage your money and as they will ultimately be needed to support your application it’s a good idea to request them from your Bank if you haven’t got them.

Finally you will need to show proof of your deposit funds, if this is in a savings account then a statement or passbook would suffice, if any or all of your deposit comes from a family gift, you will need to show evidence of where those funds have been provided from, and the family member will need to provide a letter confirming the gift, along with identification.

Tip 3 - Do your Sums!

Look at your outgoings verses your expenditure, what could you realistically afford to spend each month on a mortgage payment?

Factor in the running cost of the property (A good advisor will be able to help with these) and also give some thought to how you could pay the mortgage if for example you were off work through accident or sickness or what could happen if Interest rates increased.

Tip 4 - Beware of Price Comparison Sites and Best Buy Tables (and don't be misled by the 'lowest' rates!)

If you are completing your own research into obtaining your mortgage, a word of warning if you are using price comparison websites, or 'best buy' tables in newspapers or online.

Many mortgage lenders do not use these sites to promote their mortgages, therefore by using these, you may be missing out on some great mortgage deals. If you are using a ‘specialist’ mortgage adviser, they will have access to many more lenders, and mortgage deals than you may be able to research yourself.

An important thing to consider when deciding on your new mortgage (whether researching the market yourself or through an adviser) are the mortgage arrangement fees. Some lenders also charge 'booking fees' which are payable when a full mortgage application is made. Most 'Best Buy' tables published offer 'headline' rates - which sometimes are the ones with lowest rates (and highest arrangement fees)!

Tip 5

Don't Panic!

We have a team of experts here to help guide you through the process and help is only a phone call away!

And Finally... a couple of things not to do.

DON'T make an offer on a property until you KNOW a mortgage is available for you!

DON'T assume that because you already have a mortgage, that your lender will allow you to take it with you!

For more information or to arrange a consultation with Mortgage Advice Bureau click here or you can email Andrew directly, MABBingley@mab.org.uk



Your home may be repossessed if you do not keep up repayments on your mortgage.
There will be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1%, but a typical fee is 0.3% of the amount borrowed.

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