5 ways to boost your mortgage chances
Getting a mortgage may seem like an impossible challenge. However, it is not
as complicated as it may seem and there are ways to increase your odds.
You must make yourself as attractive as possible to the lenders to achieve the best mortgage deal, so here are Versus Law Conveyancing Solicitors top tips:
1. Don’t expect every lender to lend
Different methods are used between different lenders to decide whether it wants to lend to you. Only if you fit the lenders measures, will they lend. If you’re far off their criteria, you’ll most likely be rejected.
However, for the people in the middle, it’s not as clear cut. Therefore, the decision will be based on numerous factors, such as:
- The scope of your desired loan
- How much money you have for a deposit
- Employment status and income
- Credit score
- Existing debt
2. Are you registered to vote?
For many, this is an absolute deal breaker. Even if you have the most perfect credit score, if you’re not on the electoral roll, it is practically impossible to get a mortgage. The electoral roll is used by lenders to carry out identity checks.
On your credit file, it will state whether or not you’re on the electoral roll or not. However, it is also possible to check with your local council. It is best to check as early as possible. Even though it is possible to be added within a month, in the later summer and early autumn it could possibly take longer.
If you’re not on the electoral roll, you can register for free. If you’re are not a UK or EU national, you will not be able to get on the roll. In this case you will have to put a notice of correction on your file stating you have other proof of address and ID to be offered to the lenders.
3. Close inactive accounts – they could destroy your application
If you have an account that you’re not using, it would be wise to close it. It could be you at risk of fraud and also could mean your details need to be updated if the account is left open. On the other hand, if you’re applying for a mortgage, a longer and more stable credit relationship is positive. If you have two credit cards – one old and one recently opened – it is worth keeping them both open, since the older one could provide you with a credit boost.
4. Do not eat into your overdraft
If the lender sees you are constantly in your overdraft, it will be seen as you are living close to the edge of your finances. Therefore, this should be avoided if possible. Some lenders may not tolerate you being in your overdraft at all in the last three months. The question therefore is: if you’ve no choice but to be in your overdraft should you really be getting a mortgage?
5. Putting £100 on top of your deposit
When a little extra is put down for your deposit on top of what is required can encourage the lender to lend. For example, instead of applying for a £75,000 mortgage on a £100,000 property (where the loan is 75% of the property value), apply for £74,900 if you can afford the extra £100 deposit. All mortgages have a maximum loan-to-value (the amount you borrow in relation to the property’s worth) but it’s ideal to borrow just under this, if possible. Getting a mortgage may seem like an impossible challenge. However, it is not as complicated as it may seem and there are ways to increase your odds. You must make yourself as attractive as possible to the lenders to achieve the best mortgage deal.
Get your home buying journey started with our free conveyancing calculator. Our handy online conveyancing calculator will give you an instant quote for our legal fees and Stamp Duty, as well as an estimate of the other fees you’ll need to pay.
The Versus Law Conveyancing Solicitors can be contact here.