Get your finances in orderįollowing the legislative tightening of mortgage affordability assessments (notably with the Mortgage Market Review in 2014, and later in 2017), it is a lot harder to get a mortgage today. Be sure to check out all the associated fees with any mortgage deal before you apply. However, these are rare, and where they do exist, they can often include other charges, such as completion fees or higher lending charges. If, for whatever reason, you cannot raise a deposit, but are confident that your finances are such that you will be able to afford a mortgage, there are mortgages that offer 100% of the value of the home. So, saving a bigger deposit helps you on two fronts: not only will you receive better rates, but you will also need to borrow less, or borrow the same and get a bigger/more expensive property. This is because mortgage lenders will perceive you as a lower risk, or at least there will be more than enough equity in the property to cover the amount you wish to borrow. It is generally the rule that the lower your LTV, the better rates and deals you will receive. As an example, if you’ve saved up a deposit of £30,000 and want to purchase a house costing £300,000, your LTV would be 90% (the amount of your mortgage divided by the value of the house). The size of your deposit (or equity) compared to the amount you will want to borrow will determine your loan-to-value (LTV) ratio – and this in turn will affect the mortgage rates you can obtain. The first stage in buying your first house is saving up as much as you can afford as a deposit (if you already own a home, the equity in your property can be used as a deposit). Before you decide to borrow the max amount, use a mortgage repayment calculator to see how much a mortgage will cost you every month, and take a good look at the total costs of buying a home.Įxplore all our mortgage calculators 2. Next, you should use a mortgage affordability calculator to get some guidance on how much you’ll be able to borrow, based on your income, outgoings, and debts.Īnother thing to consider is how much you can afford to borrow. Use a mortgage broker, go direct, or get a mortgage online. If you've been declared bankrupt or have a CCJ, be aware that many mortgages won't be available to you.Ĭompare mortgages online and find the best rates. If you have any marks on your credit history, try to clean them up before applying for a mortgage. Mortgage lenders will scrutinise your finances before offering you a mortgage, especially if you're borrowing the maximum amount.Ĭlean up your credit score. The larger the deposit the better you'll be offered a lower interest rate and be rewarded with smaller monthly repayments. Use our how much can I borrow calculator to work out how much you can borrow based on your income and debt. The conveyancy process - changing the legal owner of the property - can take up to 12 weeks.īefore you apply for a mortgage, follow these steps to increase your chances of being accepted: But getting a mortgage is relatively easy. It takes about 18 to 40 days to get a mortgage. Affording a home, especially in an expensive area like London, requires financial dedication, and choosing the right home requires extensive research and a strong constitution.Ĭhoosing the right mortgage for your financial situation is a key part of the house-buying process (unless you are lucky enough to be able to afford your home outright), and can be extremely daunting. How to get a mortgageīuying a house will most likely be the most expensive single purchase you ever make. You can use our mortgage repayment calculator to get an idea of how much a mortgage loan will cost you. Mortgage loans are usually repaid monthly, with an agreed amount of interest added on. If you don't repay the loan, the mortgage lender can repossess your property. A mortgage - technically a mortgage loan - is a loan that's secured against a house, flat, land, or some kind of property.
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