Improve Your Chances of Securing a Mortgage

Mortgages & Money

Even if you’re purchasing a house for the second or third time, the application procedure for securing a mortgage can be challenging, especially so for first time buyers.

Everything from the sort of home you’re purchasing, your credit rating, the amount of deposit you have saved, and your current job status will have an impact on the final result of the application process. As if that wasn’t confusing enough, each mortgage lender has its own set of guidelines for evaluating mortgage applications, so there’s no one-size-fits-all approach.

But don’t feel daunted by all this. We will show you how to improve your chances of getting your next mortgage application approved in this brief guide.

Strive for a steady income

If you’ve had a steady income for a long time, mortgage lenders are more likely to view your application favourably. Before you may apply for a mortgage, when it comes to having a job, having worked in your present position for at least three months—three months being a typical trial or probation period with many employers—and be able to demonstrate proof of this. Of course, the longer, the better.

If you plan on changing employment in the near future, you may want to wait until you have a mortgage in place first. Likewise, when starting a new job, you may want to wait until you’ve had some time to settle in before playing, as this will demonstrate to the lender that you have better job stability.

If you’re self-employed, you’ll need to show proof of your income. Check out self-employed mortgages for more information because there are other things you’ll need to think about.

Make sure you are on the electoral register

Lenders usually check to verify if you’re registered to vote at your current home, which may sound strange, but not without reason. It’s a crucial step they use in ensuring the legitimacy of your application because it’s one of the primary methods they use to verify your identity and home address.

If you haven’t already done so, at any time, you can contact your local council to request that your name be added to the electoral register. It’s a straightforward and quick process.

Some people are concerned about privacy issues, and if that is your concern too, check to see whether you’re on an electoral register that isn’t accessible to the public. On the “open” register, your personal information will be accessible to anybody who wants to check it.

Optimise your credit history

The status of your credit history will affect your mortgage application chances quite considerably. Your lender will be more inclined to agree to your application if your history is in good standing, and the better it is, the better your chances will improve.

Equifax, Experian, and TransUnion are the three primary credit bureaus. Each one of them can provide you with your free statutory credit report. Credit Karma and ClearScore are just two examples of other services that provide this type of valuable information.

Do a thorough review of your credit report once you receive it. You might be surprised to learn that your credit report may contain inaccuracies that might lower your credit score and harm your ability to secure credit, including a mortgage. Contact the credit reporting agency if you notice any mistakes on your credit report so you can have them amended.

It’s worth bearing in mind that it may take some time to improve your credit history if it isn’t very good to begin with. For example, if you’ve ever fallen behind on your bills or had financial difficulties in the past, that’s going to look poor on your record.

A tip to help avoid missing payments is to consider setting up direct debits for recurring bills. Furthermore, check how much credit you’re using in total, and consider closing any credit cards or accounts you no longer require. This will help you to not overspend and to keep better control of your finances.

To get a credit score, you must have taken out some kind of credit, like a loan. Lenders may be reluctant to give you a mortgage if you don’t have a credit history through which they can assess your suitability for a mortgage loan, in which case you may have to take some time in building up a good record.

Using a credit card for little purchases and paying it off in full each month is one way of achieving this.

Make use of free credit-building tools

There’s some good news if you are trying to improve your credit score. There are a number of free tools available to help make the process of building a strong credit history a little bit easier.

For example, the free Rental Exchange programme might help you make the most of your existing situation if you’re renting and paying your rent when it’s due.

The plan entails paying your rent to Credit Ladder, a third party, and having that money then be sent to your landlord. The credit reference agency, Experian, receives notification from Credit Ladder anytime you make a timely payment, allowing you to build a history of on-time payments on your report.