Once money has been saved for a mortgage, the next step is preparing for the mortgage application. In this article is a bunch and helpful hints and tips of required documents to help get you on the fast track.
Getting yourself an up to date credit report is a priority in the Mortgage application process, ideally before you approach a Mortgage Broker. This is so that you don’t have to chase up such people as mobile phone providers so late on in the process due to a simple payment of a delayed £50. The report will be reviewed by your Mortgage Advisor in Birmingham before passing it onto the correct Lender.
You want to get this right first time and so do we and having this data will help massively. Being on the voter’s roll really seems to help in terms of your credit score, as does closing down credit cards no longer in use.
In terms of proving who you are you’ll need to produce some photo ID. Most customers use a Driving licence or passport for this element. You can’t use Driving Licence for ID though if you are also using it for proof of address. If you are a non-UK national working over here on a Visa, you’ll need to produce that too.
When looking at proof of ID, the required documents will have to be photo Identification such as a Driving Licence or Passport – though if you’re using one for proof of ID then it can’t be used as a proof of address. If you are a non-UK national working in England on a Visa then this will also need to be presented.
In addition to proof if Identification, you will also be required to prove where you live. This is usually in the form of a utility bill or bank statement within the last 3 months.
Your bank statements should reflect your income and regular expenditures. It will be a displeasure to Lenders if they see gambling transactions on your account and they will also not be happy if you are seen to have surpassed an agreed overdraft limit or your direct debits have bounced regularly. The key factor is to get ahead of the game and get prepared as best as you can.
Not all Lenders will ask to see your Bank Statements but it is an option that is available to them if they choose to utilise it – regardless of whether they do ask for your bank statements, they want to be confident that you take your finances seriously. The bank statements which you produce should consist if your salary going in and your bills going out.
A vital step in the mortgage application is evidencing your deposit for Anti-Money Laundering purposes. To help the process it is best not to move finances around your accounts too much as this will make it a lot more difficult and may delay the process. Lenders like to see that you are saving your money responsibly, but that doesn’t exempt you from having to account for any large recent deposits into your accounts.
If you have been gifted a deposit, then there will need to be written confirmation stating it’s a non-refundable gift.
The most pivotal point of the application is proving your income. If you’re in employment then sufficient evidence would be your last 3 months’ payslips, though some Lenders will also ask for your most recent P60. Lenders will take into account regular overtime, commission, shift allowance and bonuses. Additionally, extra earnings may also be considered with some Lenders such as part-time jobs or self-employment.
Many applicants are Self-Employed nowadays – if you are a self-employed applicant then you may mean you will need to acquire your Accounts’ help to request your last 2 or 3 years’ proof of earnings from the Revenue. If you submit your own Accounts then feel free to get in touch and we will be happy to advise you on how to go about downloading from the Government Gateway.
By working out an estimate of your expected outgoings after you move house means you can gain an idea of how much disposable income will be available to you to pay your mortgage with after such things as regular expenditures, council tax and utility bills have been paid out from your account. To help you with this, we are happy to send you our version of a Budget Planner to get you started.
As seen, there are many steps you must take in order to prepare fully for your mortgage application deeming it not an easy feat but it doesn’t mean you should worry. If you approach the mortgage application with due timing and an organised matter along with a Mortgage Broker in Birmingham, you will be in safe hands.