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How to get a Mortgage

Setting up your mortgage can be a daunting prospect, particularly for first-time buyers. There are so many things to consider, and making sure you get everything in order, and the best deal possible, can be difficult.

Get your deposit together

Your deposit is crucial in making sure that you are accepted for a mortgage when you apply. Lenders like to take some of the risk out of loaning you the money needed to buy your house by making sure you have a substantial deposit. The more you put down as a deposit, the more likely you are to be accepted. On top of this, the more you are able to commit, the better the deal you are offered will be. It may that you are able to get a shorter mortgage term, or reduce your monthly repayments, but either way committing more as a deposit will be favourable to you.

Typically people choose to put down between 10 and 20% of the value of the property as a deposit. In the past, lenders have accepted mortgage applications with a 0% deposit, but as market conditions have toughened, these sorts of deals have disappeared.

Get your research done

There are so many options to consider when you are looking for a mortgage. Choosing which type of mortgage is best for your needs is the first step. Once you have done this it is time to choose your mortgage provider. At this point it is worth speaking to a broker or advisor who will be able to give you information about your best options, and can help you to arrange your mortgage. Any advisor you use at this stage should be whole of market, like our advisors, in order to supply you with your best option, and not just one from a limited panel of providers.

Getting a good mortgage deal is like buying car insurance. You wouldn’t just settle for the first price you see, and because of the massive financial commitment a mortgage saddles you with, getting it right is hugely important

Been refused a mortgage?

There are a wide variety of reasons why you might have been refused a mortgage loan by a lender, and being refused is never a nice experience. However there are actions that you can take to try and make sure that, next time you apply, you are accepted.

- Don’t apply too many times. Although this may seem counterproductive, every time you apply there and are refused a mortgage it is recorded on your credit history. Potential lenders will see this in the future when you apply, and the more refusals you have against you, the less likely you are to be accepted. You should leave at least 4-6 months between applications.

- If you have a low income you could consider a shared ownership mortgage. This means you will own a share of the house, while paying rent on the rest. You will have the option to buy out the rest of the house in the future. For more information on shared ownership, contact one of our advisors.

- Improve your credit rating. Unfortunately a poor credit rating is a major barrier to being accepted by a mortgage provider. However there are actions you can take to try and improve your score for the future. Register for your electoral roll, get rid of any unused credit cards, pay any debts off on time, and use a credit card often for small transactions, making sure these are paid off on time. This will not be an instant fix, but over time could help prove to lenders that you have changed your ways.

Make sure you’re OK with the commitment

From a financial point of view, taking out a mortgage will most likely be biggest commitment you ever make. You need to remember that you should only borrow what you can afford to pay back, as defaulting on your mortgage payments could lead to repossession of your home, and will severely hamper your chances of being approved for another mortgage in the future.

This means you shouldn’t just take the maximum amount offered by a lender, because although your current situation may allow you to make payments comfortably, you never know what the future holds. It’s all about planning, and this is where getting the help and advice on offer from a financial advisor can be so crucial.

Need more help and advice?

Our team of mortgage advisors can help you with any mortgage queries you have, from finding you a lender, to giving you advice on your current deal. We deal with the whole of market, meaning we are able to find the best deal for you, and not just a compromise from a limited number of providers

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