Before offering you a mortgage, lenders will review your finances to assess whether you can afford to make your monthly repayments. The following steps can help get your finances in good shape before you apply:
Save – Put aside as much as you can towards a deposit as this will increase your chances of being offered a more competitive mortgage. To do this, open a dedicated savings account and look for the one paying the highest rate of interest.
Check your credit score – To secure a mortgage deal with a competitive interest rate, you’ll need a good credit rating. Tips to improve your credit score include checking you are on the electoral roll, paying bills on time and clearing your credit card balance in full each month.
Budget – Regularly look at how much you have coming in and going out each month and close or cancel any accounts, subscriptions or memberships you no longer need. Lenders will examine how much debt you have, including whether you are using your overdraft. Consider using any savings to pay down existing loan or credit card debt, although remember to keep some back to cover emergencies.
Timing is key – Several lenders withdrew their ‘high loan-to-value’ (LTV) products during lockdown, which typically only require a deposit of 5% or 10%. Some high LTV products are returning to the market, so if you are a serious mover you may need to act soon.
Seek advice – It’s important to ensure you choose the right mortgage for your circumstances, which is why it’s worth seeking advice. We can help and support you through the entire mortgage process and help you find the most suitable deal.
As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.