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What Do They Ask For When Applying For A Mortgage?

When you think about applying for a mortgage you probably have visions of a bottomless pit of paperwork. If you’re a first-time buyer, we’ve created a simple guide that runs through the basics of how to prepare for a mortgage interview so you can whizz through it like a professional. Knowing what your advisor or lender is likely to ask when applying for a mortgage will also help you feel more confident and be prepared.

Proof of identity

First things first, you will need to prove your identity with a passport or driver’s licence. So make sure you have one of these to hand.

Earnings and job stability

Securing a loan is all about proving you are able to pay it back. Key indicators include your earnings and job stability. For some mortgages, you need to earn over a certain pay bracket in order to qualify. For others, you can simply secure a more favourable deal by having a decent salary with a job that’s considered stable.

If you’re looking for a joint mortgage with a partner, their income will also be taken into account.

Preparing if you are self-employed

If you’re self-employed, the paperwork you’ll need to present is a little different. Typically lenders may see you as more high-risk than someone who is working for an employer. However, with the right documents, you can jump through the hoops and secure yourself a suitable mortgage deal.

You will need to provide self-assessment forms and tax returns dating back a certain number of years.

Spending habits and savings

While your spending habits might seem like a personal thing to ask about, it’s all part of the standard procedure. Lenders need to delve into your current spending habits and savings in order to calculate how much you could comfortably afford to pay in monthly mortgage repayments.

They will look at any direct debits and standing orders you have on your bank accounts, credit card and loan balances, essential and routine costs for things like groceries, and pension contributions.

Credit score

As well as your current financial situation, lenders will also look at your history. Your credit report provides an overall financial health score. It will also flag up any notable issues, such as County Court Judgements, missed payments, or debt. Don’t worry if you’ve experienced problems with your finances in the past. It may be more difficult to obtain a mortgage, but there are still options for people with a bad credit history or score.

We hope this article has clarified what you need to prepare for your mortgage interview and what your mortgage broker or lender is likely to ask. Knowing what to expect will not only give you peace of mind it will also save you time and hopefully help you secure your dream property sooner.

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