10 tips for getting a mortgage
Many people use a mortgage to purchase a home. Whether you’re a first time buyer going through the mortgage process or you need mortgage tips, our guide covers some key information about how to get a mortgage.
1. Find independent mortgage advice
An independent mortgage adviser isn’t tied to a specific lender, which means they may be able to explore a wider range of products. They can assess your financial situation, outline available products and support you through the application process.
2. Check your credit score
Credit scores are one of several factors lenders consider when reviewing mortgage applications. A high score can help you access more products and lower interest rates.
You can check your credit report online using credit reference agencies such as TransUnion, Experian and Equifax. Some key areas to review include your personal details, address history and financial information. Any inaccuracies can usually be raised with the relevant agency, and doing so early may help avoid delays
It can be helpful to check your credit report at least three months before applying for a mortgage to allow time for improvements and address any issues. Understanding your score can help you target lenders and mortgage products that are most suitable for you.
How credit scores affect mortgage offers
Credit scores play an important role in whether lenders approve your application and what interest rates they offer. Lenders use credit scores to assess risk, with higher scores generally demonstrating a reliable borrowing history. New build mortgages usually have the same credit requirements as existing properties, although criteria can vary by lender.
Tips to improve your credit score
Credit score improvements typically take 3-6 months to show, so it's best to start early. Here are some ways you can improve your credit score:
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Check for mistakes. Errors, outdated information and unknown accounts can all affect your credit score, so make sure everything is correct on your report
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Make all your payments on time. No matter whether you’re paying a utility bill or credit card debt, a late or missed payment can lower your credit score, so ensure payments are made on time
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Register to vote. Registering to vote may improve your credit score, as it helps lenders to confirm your identity and address
Applying for multiple credit products at once can also negatively affect your score. For more information, explore our article on 10 ways to boost your credit score.
3. Keep on top of your debt repayments
Missed payments can significantly impact your credit score and mortgage applications. You can set up direct debits to avoid accidentally missed payments.
Recent missed payments (within the last 12 months) can significantly impact mortgage approval chances, while older issues have less influence on lenders’ decisions.
Debt repayment strategies can vary depending on your individual situation, including income, interest rates, credit agreements and other financial commitments. There is no single approach that works for everyone. However, paying more than the minimum amount due each month could help keep your credit utilisation low, reduce the amount of interest you owe over time and potentially improve your credit score.
4. Understand your affordability
Understanding how much you can afford can help you streamline your property search. Knowing this number will help you understand what you can afford, so you can start viewing properties within your price range.
Calculating your mortgage budget
Online mortgage calculators can provide quick estimates of borrowing capacity based on income, deposit and basic outgoings. These tools can offer useful starting points when getting a mortgage, helping you understand realistic budgets before viewing properties beyond your means. Some lenders use income multiples as part of their assessment, though the exact figure can vary depending on the lender and your individual finances.
While online calculators can be useful, it might be worth speaking with a mortgage adviser early in the process, as they may be able to consider the nuances of your financial situation and help you understand your options in more detail.
Income, outgoings and affordability checks
Eligibility criteria vary by lender, but earnings, employment type and income stability are common considerations. Lenders may also examine bank statements for regular outgoings, including subscriptions, childcare, travel and discretionary spending, to calculate the disposable income available for mortgage repayments. Self-employed applicants can face stricter scrutiny and may be asked to provide additional information, such as multiple years of accounts, to prove sustainable income when getting a mortgage.
Lenders often stress-test affordability by calculating whether you could still afford repayments if interest rates increased to protect both parties from future financial difficulty. Mortgage advisors can help you understand how different lenders assess affordability.
5. Save for a deposit
Most buyers require a minimum deposit of 5-10% of the property’s purchase price. However, larger deposits can unlock better mortgage deals and lower interest rates, as you’ll have a better Loan to Value (LTV) ratio. This is the ratio of the money you are borrowing compared to the value of the property.
For example, if a property costs £100,000 and you put down a £25,000 deposit, you’d need a £75,000 mortgage. This means your mortgage would represent 75% of the property’s value, giving you a 75% LTV ratio.
A higher LTV ratio can limit the range of products available from some lenders, and interest rates may vary by lender and deposit size. However, a larger deposit with a lower LTV ratio can usually yield better interest rates and lower monthly repayments.
Explore our low deposit schemes to learn more about schemes that can help you move.
6. Know what you can borrow
Lenders may offer mortgages based on a multiple of your income, which can range from around 4.5 to 6 times your salary. In some cases, this may be even higher. The amount offered will depend on the lender’s criteria, the product you selected and your individual circumstances.
Getting a Decision in Principle (DIP), also called a Mortgage in Principle (MIP), from a mortgage lender or broker can help outline how much money you could borrow for your home purchase. When it’s time to make an offer on a home, sharing your DIP can strengthen your offer, though it may be worth speaking to a mortgage adviser beforehand to understand when it might be suitable to share one.
7. Organise your documents
Having all your mortgage documents ready can help accelerate the application process and demonstrate organisation to lenders.
Some essential documents you’ll need include:
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Proof of identity (passport or driving licence)
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Proof of address (utility bills or bank statements)
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3 to 6 months of bank statements
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Recent payslips, P60 forms and tax returns if you’re self-employed
Self-employed applicants also need SA302 forms from HRMC, 2 to 3 years of business accounts and an accountant’s letter confirming income stability.
Digital copies can make it easier to share important documents with mortgage brokers and lenders, although some may still request originals. Some documents can take time to obtain, so you may find it useful to gather them in advance.
Bank statements and income proof
When applying for a mortgage, lenders may require 3 to 6 months of bank statements that show regular income deposits and your spending patterns. Looking over your own bank statements and spending patterns ahead of time could help you understand what you can afford and where you might reduce spending.
How to present your finances to lenders
Presenting mortgage documents to lenders in a clear, chronologically ordered format can help streamline the assessment. Some applicants also include explanatory letters for any unusual transactions, employment gaps or credit issues. Highlighting financial positives, such as consistent savings, regular income and responsible credit, may help lenders get a clearer picture of your overall circumstances.
8. Register to vote
Some lenders use electoral roll information to help verify an applicant’s identity. Electoral registration is free, and it can be completed online in just a few minutes.
9. Explore high-interest savings accounts
Savings accounts can help you grow the amount you save over time. There are various types of savings accounts to choose from, each with different features. The right type of account depends on individual circumstances, including how quickly the funds may need to be accessed.
Fixed-rate savings accounts usually pay higher interest, but your money is locked away for months or years. Banks often give better rates for regular savings accounts if you want to put away the same amount each month. You may be able to earn up to £1,000 in interest tax-free, depending on your Income Tax band. This is known as your Personal Savings Allowance. Visit GOV.UK to learn more about how interest on savings may be taxed.
Alternatively, with an Individual Savings Account (ISA), you can currently save up to £20,000 a year and pay no tax on the interest you earn.
10. Reduce your debt
Existing debt can impact mortgage affordability assessments. Regular outgoings like credit card debts, personal loans and car finance could reduce your borrowing capacity. Whether it’s better to use any extra money you have to increase your deposit or reduce existing debt will depend on your specific situation, so it may be worth speaking with a mortgage adviser before making any decisions.
Common mortgage mistakes to avoid
Being aware of common pitfalls can help you navigate the mortgage process more smoothly.
Applying too early or too late
Applying too early (before starting your property search) can mean mortgage agreements expire before you need them, so you’ll have to reapply and obtain new credit checks. Most mortgage offers last three to six months, so timing applications appropriately can help avoid unnecessary steps.
Sellers usually don’t expect prospective buyers to have a mortgage agreement in place during property viewings, but a DIP can signal that you’re a serious buyer by demonstrating how much you can afford. However, some mortgage advisers may caution against sharing your DIP too early, as it can impact negotiations, so it could be worth checking with an adviser before doing so.
Applying too late (after finding a property you want to make an offer on) can create pressure and potential delays when getting a mortgage.
Taking on new credit before applying
Taking on new credit cards, loans or other financing agreements too close to applying for a mortgage can affect affordability and temporarily impact credit scores. Lenders may view recent credit applications as red flags indicating financial difficulty or irresponsible borrowing.
Ready to become a homeowner? Call or visit our Sales Advisers to start your home buying journey today.
Disclaimer:
This article is for general informational purposes only and does not constitute mortgage advice. We would always recommend that advice is taken from a regulated mortgage adviser regarding your specific circumstances.
Mortgage FAQs
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A mortgage in principle is a lender’s estimate of how much they might let you borrow before you apply for a mortgage.
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The amount you can borrow for a mortgage depends on several factors, including your income, credit score, deposit and the value of the property you want to buy.
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A mortgage typically requires a suitable deposit, proof of income, a good credit score and details of any debts. Lenders use this information to decide if you qualify and how much they can lend you.
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Several factors can affect your ability to get a mortgage, including your credit history, income, employment status, deposit, debt levels and the value and type of property you want to buy.
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When applying for a mortgage, you’ll typically need to provide the following documents:
- Proof of ID - a passport or driving license.
- Proof of address – a bank statement or utility bill.
- Evidence of your income – payslips or accounts if you’re self-employed.
Read our guide for more information on the documents you need to get a mortgage. -
Things that may stop you from getting a mortgage include a low credit score, too much debt, irregular income, or not having a big enough deposit.However, numerous lenders can help people with different financial circumstances, so it’s always advisable to speak to a mortgage broker to find out what you can afford.
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Yes, mortgage lenders review your spending habits to assess whether you manage money responsibly. They look at regular expenses, debts and any risky spending to decide if you can afford the loan.Explore our brand-new homes across the UK, with fantastic offers to help you move.Call or visit our Sales Advisers today to start your homebuying journey.
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