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LAURUS LIFE | Lifestyle
With all the costs associated with the process of buying a home, it’s not surprising that people might be reluctant to take on more by hiring a mortgage broker, instead opting to negotiate with lenders on their own.
However, it’s worth considering that a broker can actually save you money by finding you a better deal, and can also potentially be paid by a commission from the lender rather than charging you a fee.
They can also keep the process moving swiftly for you, because they’ll know where your best options are and will do all the chasing up, leaving you to focus on other things, safe in the knowledge that your application is progressing as quickly as possible.
Your deposit is crucial to your mortgage application and a lender will want to see how you built it up as well as whether you actually have the money or not. So, if you have bank statements that show your saving habits, be sure to use them in your application, which will impress the lender and speed up your application.
The reality for many people these days is that they receive financial help from family to bring their deposit up to the amount required. If that’s the case for you, be sure to include a letter from your donor confirming the gift.
Even if you’re not normally someone who is good at dealing with paperwork, your mortgage application is one time when you really need to have everything sorted and in order. While you’re going through it may be helpful to gather them all together in a special folder to keep them safe and in one place.
Here’s what you may well need:
You’ll also need to check for any mistakes in them before you hand them in, otherwise correcting them can mean delays:
Check and correct wrong addresses
When you move home, one key bit of life admin is to ensure your new address is updated across documentation like drivers’ license, electoral roll, etc. When applying for a mortgage, these need to be correct, so it’s worth double-checking them and correcting them as a matter of urgency.
Check and correct any mistakes and typos
Anyone can make a mistake or typo in a document, but your mortgage application needs to be 100% correct, especially when filling in important details, because anything that doesn’t match up with your evidence will mean delays as the lender seeks clarifications.
Update your new married name
If you’re buying a house soon after getting married (congratulations!) and have changed your name, this can be another area where inconsistency in your evidence can cause issues. Make sure you’ve updated accounts with your new name and include evidence of the name change.
There are still several other aspects of your application that could cause avoidable delays, so here are some areas that you need to pay close attention to before submitting:
Close any unused credit cards
Your credit report is a big part of your mortgage application, for obvious reasons. Lenders will look at your overall credit limit when making their decision and this can include credit cards that you may not even use very often. So if you have any cards that you’re keeping for a rainy day, it may be worth considering closing them before applying.
Disclose ALL current credit, no matter how small
When listing any credit you owe it can be easy to list any loans or credit cards, but there can be many other types of credit that you may have which will show up when the lender checks. These can include ‘buy now pay later’ services like Klarna, store cards, mobile phone contracts, etc, so be as forensic as possible when listing them.
Pay your bills & direct debits on time
It may be too late to change your past payment habits, but as soon as you start to consider a mortgage application, you need to be punctual with any payments to avoid any impacts on your credit rating. It’s also worth double-checking your direct debits to ensure that you have the money in your account to pay them when they’re due.
Don’t take out payday loans
Payday loans are sold on the basis that they are a quick fix for a temporary financial problem, but they can cause lasting problems when it comes to mortgage applications. If you can avoid them, you’ll have a much better chance of getting through your application quickly.
Submit your tax return early (if self employed)
Being self-employed means submitting your tax return every year, but if you usually leave this until just before the deadline in January, you might need to change your habits this time. You’ll need it as proof of your income for the previous tax year, so getting straight on with submitting it needs to be a priority.
As you’ll have seen, there’s lots to consider when sending in your mortgage application to make sure that not only is it successful but that there aren’t any hiccups that can cause delays. There may be a lot of hard work involved to check all the details and correct any errors, but it will be worth it in the long run if it gets you ever closer to your dream home.
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