5 tips to improve your mortgage chances
The world of mortgages can appear complicated, convoluted and pretty expensive from those at the bottom of the property ladder, looking up. If you are speaking to first time buyers, then it’s a good idea to know what to say if they have any queries about mortgages before pointing them towards your in house advisor or trusted lenders. It boosts confidence in you and your agency and can encourage people to use your services.
Here are a few tips you can suggest to those looking to buy, to help improve their chances of getting a mortgage and on the property ladder in 2017:
1. Work on that credit score
Your credit score is important when applying for a mortgage, and while different lenders have different scoring systems when considering applications, it’s still a good idea to encourage potential buyers to check if their credit is classed as good or excellent. Services such as Experian and Equifax are good for checking credit score; Equifax’s scoring is stricter and presents your credit file in more detail. Tell them to ensure there are no defaults outstanding and settle any debts being flagged on their credit report before even considering a mortgage.
2. Ensure they are on the electoral roll
Your identity is usually verified by lenders via the electoral roll, so to ensure you have a better chance of being accepted for your mortgage straight away, being listed at the correct address on the electoral roll is important. In fact, in this Guardian article it stated that not being on the electoral roll is a major mortgage pitfall.
3. Shop around
It’s a good idea to seek out the best deal and to also find a lender that will be likely to accept your mortgage application. Advise potential buyers that they can pay a broker to compare lenders and make applications for them and then point them in the direction of a trusted broker or advisor connected to your agency. They can also use a tool like the Money Advice Service’s mortgage comparison checklist to get an idea of who is the best choice before speaking to an advisor.
4. Offer a bigger deposit
A bigger deposit means the lender is more likely to accept your application because there is less risk for them straight away. Larger deposits can also help bring down the amount paid each month so it’s a good idea that they get as much money behind them as possible.
5. Gather all the right documentation
When applying for a mortgage, lenders will ask for a variety of important documents to verify your identity and ensure your financial information is correct. Advise those potential buyers to gather together:
- Up to date identification – such as a passport or driving license.
- A recent letter proving their address – such as bank statement or bill.
- Payslips for the past three months plus P60s for past two years.
- Documentation of benefit income – such as child maintenance.
If they are self employed, they will need to fill in an SA302 form covering their past three years of income as well as evidence of everything they have earned. Encourage them to get all of this documentation in good order to avoid any hold ups or their application falling through.
First time buyers will appreciate this basic but free advice and many may not even know the simple basics when it comes to buying a home. Ensure you can help out at the beginning and build up lasting relationships with those potential future home owners.
Debbie Fletcher is a regular contributor to the RentPro blog as a guest writer. She is an enthusiastic, experienced writer who has written for a range of different magazines and news publications over the years. Graduating from City University London specialising in English Literature, Debbie’s passion for writing has since grown. She loves anything and everything technology, and exploring different cultures across the world. She’s currently looking towards starting her Masters in Comparative Literature in the next few years.