If you’re looking to buy a new home, you’ll likely need to finance it, which is why that moment when you learn whether or not you can get a mortgage can be a truly ‘make or break’ point. With that in mind, here are 10 tips to improve your odds of being accepted for a loan for your home.
1. Don’t play too much with your application
Once you’ve begun the application process, don’t play around with it by amending the numbers, as this can result in delays. The lender might turn down your request for the extra finance, and may even decide not to lend you any money at all.
2. Use a broker or shop around
Once you know the kind of mortgage you’re looking for, you should seek the best deal you seek out the best deal for your situation. You could save yourself thousands of dollars by finding the most cost-effective deal.
3. Know the type of mortgage you’re looking for in advance
There are all kinds of mortgage lenders. All, however, take interest rates into account when assessing your affordability. So should you be unsure whether you could afford a repayment increase or not, you should go for a deal with a fixed rate.
4. Collect self-employed earnings evidence
Mortgage lenders get nervous about applications from self-employed people, and so it’s important to provide even more additional earnings evidence as a self-employed person than if you were a full-time employee.
5. Prepare all your documents
A decent mortgage lender like Altrua Financial will only lend to you if you have proof of your identity. So make sure that you have your current address on your driving license and that you have a valid passport to hand.
6. Avoid any unusual properties
Mortgage lenders are less likely to lend against a property considered to be unusual, and therefore possibly more difficult to sell on.
7. Get on the electoral roll and ensure your address is up-to-date
Many mortgage lenders verify your identity via the election roll, so if you aren’t registered at your current address, your application may be refused.
8. Pay off unsecured debts. Close all unused accounts
Mortgage lenders don’t just look at how much you owe, but also at the total amount of credit that’s available to you. So you should look to pay off as much debt as you can, and close all accounts no longer in use.
9. Find out your credits score to avoid surprises
The most favorable mortgage deals require a good credit score. There are websites that allow you to check your score for free. Each of these services use a soft check that doesn’t affect your score.
10. Save as big a deposit you can
Mortgage providers restrict their minimal interest rates to those with large deposits. So the majority of the market’s top deals are limited to those buyers who can deposit 35-40 percent of the value of a property.