Expert Mortgage Advice & Low % Rates

A lot of people have questions when it comes to buying a mortgage, it’s a significant purchase that requires a lot of thorough information rather than jumping in head first and hoping for the best. Finance Advice Centre are here to help you have all your queries answered so you are fully informed when you want a mortgage. 

How do I choose the right mortgage for me?

There are currently hundreds of mortgages deals available and one of the most difficult parts of organising a mortgage is finding the one that will best suit you. Different schemes will cater for different needs, so it is important to look at your current circumstances as well as your long-term plans and priorities. If you need guidance on this matter, we recommend speaking to an advisor as soon as possible. Mortgage advisors can provide you with the most suitable mortgage advice for your situation and get you on the right path. 

What fees might I expect when getting a mortgage?

Typically, the list of fees can include:

• Valuation fee – this is paid up front with your application and is charged by the lender to value your property
• Solicitors fees – this will be partly paid up front and part will be paid upon completion of the solicitors job of finishing the conveyancing transactions on the property
• Stamp duty land tax – a tax by the government on any property purchase in England or Northern Ireland over £500,000
• Lender arrangement fees – can be added to the loan in most circumstances but will increase the size of the loan overall.
• Booking fee – charged up front with your application this is a payment to the lender for booking the funds for your mortgage
• Broker fees – you might be charged if you are using a mortgage broker, this is payable either up front or on completion

How do I prove my income?

If you are employed, you will be required to provide at least your last 3 months of payslips and in some cases your P60. If you are self-employed the simplest way to show your income is through SA302s which you can get from HMRC. You can also provide at least 2 years trading accounts but be aware that some lenders may have other requirements. You will also need to show your bank statements for the last 3 months and any other form of income you may have e.g., tax credits will need to be proven through written evidence from the provider.  

Do I need any insurance with my mortgage?

Your lender will insist that buildings insurance is in effect when you move into your new home. Home insurance will combine building and contents insurance to protect your most valuable assets. Also, when taking out a substantial debt it is advisable to get insurance to protect against other issues such as death, injury, or a long-term illness. 

How much can I borrow for my mortgage?

There is no set calculation as every lender will have a different approach in working out what you can borrow. The amount you are eligible to borrow will be determined by the cost of the property you want to buy, the size of your deposit, and your income and affordability (this will consider your monthly financial commitments and any future commitments). If you need more details about a mortgage you can speak to a mortgage specialist who will be able to provide you with any important information you need. 

What is a remortgage?

A remortgage is swapping the mortgage you have on your current property for another mortgage with a different lender. This can be an option when your mortgage deal has expired, and you want to see if a more competitive deal is available somewhere else. Also, you could remortgage if your circumstances change and you want to borrow more.

What do I need to apply for a mortgage?

The mortgage application process does require some paperwork that you will need to have ready to show. This can include:

• Utility bills 
• P60 form from your employer
• Proof of any benefits you receive 
• Passport or driving license to verify your identity 
• Your last 3 months of payslips
• Statements from your current bank account for the last 3 to 6 months
• Tax return form SA302 if you have an income from more than one source

It’s important to remember to be accurate with the information on your application form and ensure that it lines up with the documents you supply. For example, don’t round up your salary, it must be written as it states on your payslip. 

These are some of the basics, some lenders can ask for more paperwork and have different criteria around outgoings and income. Printed out copies of your current account and utility bills might not be accepted by some lenders. If that is the case you will either need to get hard copies or copies that are certified by your solicitor, bank, or utility provider. 

Why do mortgage applications get declined?

Have you ever had a mortgage application declined but you’re not too sure why? You’re not alone but becoming aware of some of the reasons why applications get rejected through our list below will help you understand what you can do to give you a better chance of your application being accepted the next time you apply. 

1. Poor credit history- having a bad credit history won’t make it impossible for you to get a mortgage but if you work on improving it before you apply for a mortgage it will give you a better chance of acceptance. 
2. You’re not registered to vote- being on the electoral register at your current address will help lenders to verify who you are and where you live. 
3. You have too many credit applications- when applying for credit the lender will check you are suitable by searching your credit report. A lot of searches are recorded and will leave a mark on your credit history. Frequently applying for credit gives the appearance that you have problems with money, so try not to take out any new credit deals at least 12 months before you want to apply for a mortgage. 
4. You have too much debt- having a substantial amount of debt won’t give a lender confidence that you will be able to pay your mortgage. Try and clear as much debt as you can before applying for a mortgage. 
5. Payday loans- one reason many people don’t know about is if you have had a payday loan over the last 6 years it will be listed on your file even if you have paid it off on time. It can still count against you because lenders can think that you might not be able to cope with a large financial responsibility like a mortgage. However, this can vary with lenders it doesn’t always mean you will be rejected for a mortgage. 
6. Not having enough earnings- smaller mortgages are available for lower incomes. Another option is seeing if you are eligible for any of the government’s home buying schemes to help provide an extra money boost. 
7. You have a small deposit- saving up a deposit is tricky, especially in these difficult economic times. The bigger deposit you can save the better it will be on your application. However, there are schemes out there for buyers with only a 5% deposit. 

As a mortgage is secured against your home or property, it may be repossessed if you do not keep up the mortgage repayments. 

This article is for information only and should not be seen as advice or a recommendation to take action.