PREPARE TO ‘SELL’ YOURSELF TO GET A MORTGAGE

Your mortgage is usually the biggest financial commitment you will undertake and quite possibly the most bewildering.

With the Mortgage Market Review (MMR) that came into effect April 2014, lenders now consider different aspects which may affect their view of whether they want to lend to you, as well creating more hurdles to jump over.

Preparation is crucial whether you are a first time buyer or reviewing your current mortgage. It is well worth planning up to a year in advance to ‘sell’ yourself to lenders by following these action points:-

• Keep tabs on your credit record – late payments can stay on your credit file for up to 12 months
• Pay off all or as much as you can of your debts
• Build up a deposit – Having a higher deposit will not only improve the likelihood of obtaining a mortgage but you could also get preferential rates. It may be possible to get a mortgage with a 5% deposit but you will pay for it later
• Lenders now base their decision on affordability rather than income. Extensive questions are being asked on lifestyle spending, they will take into consideration hobbies, utility bills, childcare and eating out.

IFA & mortgage advisor at Clarke Nicklin Financial Planning, Jon Nield comments:

‘If you engage a good advisor it will bypass the lengthy meetings with some lenders whilst ensuring the mortgage fits your circumstances and with your affordability. 

‘As long as you are armed with the correct documents such as payslips, bank statements and evidence of savings an indicative offer can be arranged within 1 week, and a full offer in 4-6 weeks’.

The FCA are also clamping down on pressure selling for loans of any type including mortgages. Unless you have specifically agreed to an adviser calling you with regard to reviewing your mortgage, they are now unable to contact you.

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it. Think carefully before securing other debts against your home.

Clarke Nicklin financial planning is a trading name of CNFP LLP, CNFP LLP is a Ltd Liability Partnership registered in England and Wales No.OC324909. CNFP LLP is an appointed representative of Lighthouse Advisory Services Ltd which is authorised and regulated by the Financial Conduct Authority