Getting a Mortgage

Hey guys! :wave:

I have been thinking about going #FullMonzo for a while now; I’ve even got a #FullMonzo friend who praises it whenever I ask him any questions about it.

I almost went ahead and did it the other day, but two things stopped me.

  1. I only just got a credit card with NatWest, and I’d like to try and build up some credit.
  2. I’m also saving for a property.

The property point stopped me the most because when I eventually get a mortgage, it’s most likely going to be with a bank such as NatWest, Santander, etc.

I know that Monzo is a fully licensed bank :moneybag:, I have no doubts in their ability to match the legacy banks on the high street in terms of functionality. However, will who I get my mortgage with, have any trouble in determining my ability to acquire a mortgage if I am #FullMonzo?

Has anyone managed to get a mortgage whilst being #FullMonzo?

Thanks in advance!

1 Like

Why not just keep both open?

A viable option for sure, but just wondered if I’d encounter any issues if I did go with just Monzo.

I doubt that it’s necessary these days, though it does seem intuitive to think that if you’re going to be getting a mortgage from a bank, it makes sense to have been banking with them.

Before the dawn of time I was struggling to get a mortgage, and the guy in Abbey National (yes, it was that long ago) was turning me down, and casually remarked that the answer might have been different if I’d had an account with them already. I suddenly remembered I had £1 in an old savings account I hadn’t used in years, rushed home to dig out the passbook, and bingo! I was a soon to be homeowner.

1 Like

Hahaha, that’s interesting! So maybe it’s worth just keeping my current account around as proof I’ve been banking with the old school banks. Perhaps just having an account is good enough, instead of using it as my main bank account?

At the end of the day, I think if I could prove I earn X amount of money per month, which could pay off a monthly mortgage payment of Y, then that’s all they’ll need I suppose.

1 Like

Totally off topic but why with one of those banks?

My mortgage adviser found me a far better deal than any of the big banks could offer. I think you’ll be surprised at how competitive some of the lesser known lenders can be in this market.

If you’ve been with them a long time I’d recommend keeping it open and leaving it dormant. This can have a positive effect on your credit rating and you have a backup bank too should you want to make a large cash deposit for example. This is something that some people mention on here :slight_smile:

2 Likes

Not off topic at all! I won’t lie, I was quite unaware that there is a good set of competition out there for mortgages - I suppose I’ve only ever known about my parent’s experience with NatWest / Santander. Good to know I wouldn’t be stuck for choices!

Really good idea, thanks! I appreciate it. It doesn’t hurt to keep it around I suppose, having a backup could prove useful if there are any issues with Monzo that pop up unexpectedly.

1 Like

And that does happen.

I had worries about this at one time, I was with a bank that had pre-selected me for a bunch of things, credit cards, loans and mortgages at apparently good rates (I didn’t need them at the time so I don’t know). It was great I felt valued.

I went full monzo and and kept the account dormant, and all of those offers vanished. I called up to ask why, and they had said they hadn’t seen any money go into the account so ‘algorithms’ do not think I qualify. Which doesn’t mean I cannot apply, but I would have to go through the normal credit check process and have a lending team assess my finances etc. The Algos apparently refresh and review every 3 months (apparently) so if i went back in 6-9months i will be back to being valued.

I think it would be helpful if anyone who has experience with a mortgage/loan and the application process with a bank they don’t necessarily bank with to share their experience!

1 Like

I bank with Monzo and they don’t do mortgages so I fit that criteria :wave: In fact I have no other accounts.

I moved house and got my mortgage around 5 months ago. What would you like to know? :slight_smile:

In fact I’ve never had a mortgage and bank account in the same place :laughing:

1 Like

@Ordog Thanks for the reply!

I’m curious to know what the process was like, and if you noticed anything in the process that would of been easier if you had an account with the bank? (if it was from a high st bank)

I think @will.hitt’s core question is something that alot of people (esp young people) who are afraid of going #fullmonzo are thinking but not asking.

@bea maybe you could, write one of your cool informative blog posts about it?

1 Like

I didn’t have a clue about mortgages so I used an independent mortgage adviser when I bought my house so they could find me the best deal and be impartial. When it comes to borrowing tens or hundreds of thousands of pounds any small difference means that you could save a lot of money. I personally wouldn’t trust that my local bank would have my best interests in mind and they would obviously never recommend someone else even if they were better.

I used Halifax 5 years ago and this time I’ve gone with a lender that I’ve never heard of and I can’t remember their name :sweat_smile:

Both lenders asked for the same sort of things:

  • They want to know your salary and employment details
  • They want 3 months of bank statements
  • How much you owe other people. EG car loans, overdrafts, credit cards etc
  • How much you roughly spend on other things such as clothes, going out etc.
  • How much you want to borrow
  • The type of mortgage and how many years you want it over.

My adviser searched the market for me but ultimately this is all put into a computer and that decides what it thinks you can afford. For example, if after you’ve paid your mortgage and all the above you’re going to be left with £50 a month you will get declined. To my knowledge it is based on the things in the above list and less on your credit rating.

I imagine that if I had a bank account with them all that would be different would be that I wouldn’t need to provide bank statements. Which took me two seconds because you export them in the Monzo app and email them over.

So in short, being full Monzo had zero impact on me getting a mortgage and it was just as simple as the one I got 5 years ago when I was banking with Santander instead of Monzo :slight_smile:

4 Likes

Switched Monzo to my sole bank account last year and haven’t had a difficulty in securing a mortgage.
Everything @Ordog mentioned above is absolutely right and the best thing about it, is the budget planning as it truly breaks down the affordability aspect and gives a clear picture as to whether it’s right for you.
Our mortgage adviser found that Santander was our best offer and this is the first time that myself or my other half have ever used Santander.

2 Likes

Thank you for your explanation, this is really helpful! I’m happy to see that people can still get a mortgage when not using a high street bank.

1 Like

Hi @will.hitt

I’ve been #FullMonzo now for 18 months or so as well as my girlfriend and we got our mortgage sorted at the beginning of this year. Being with Monzo wasn’t an issue, as a few have said make sure you use a mortgage adviser/broker who is impartial that way they will recommend the best product for you.

This service can often be free of charge as they make their money from signing you up. Regardless of who your provider is they’ll all ask the same typical questions regarding your incoming/outgoings as well as needing a few months bank statements.

Best of luck, it’s nowhere near as daunting as people suggest!

1 Like

Great to hear another successful story of being #FullMonzo and still being able to get a mortgage. I think as soon as Monzo introduce a way to build credit, like with my NatWest credit card, I’d be more than happy to make the full switch.

1 Like

I’m not sure when you’re looking to start your mortgage application but it’s always best to plan ahead as credit takes quite a while to alter.

I found it worthwhile paying for a credit score service (experian) just for a few months to see exactly what was influencing my score. There wasn’t anything too shocking on there but it certainly helped with one or two things that I wasn’t aware of. Even small tasks like making sure my phone bill was displayed (as it counts as credit) boosted my score and put me in a strong position.

Once I was happy with my score (999/999 :innocent:) I simply went back to their free service.

1 Like

What a shame, then, that mortgage providers can’t see your ‘score’, and make their own assessment of your creditworthiness, without taking into account the opinions of the credit reference agencies.

Were Monzo statements OK? Are they not a bit of a mess with money in pots, and money flow not 100% clear? Did you have to explain any of it or clarify any of it?

I’m looking to get a mortgage soon and I’m a tiny bit worried that Monzo statements could be an issue.

When handing over my statements I just explained what the numerous pot transactions meant! I thought it would save time to explain it as first rather than waiting for them to look into it then get back to me etc.

I have a round-up as well as two daily IFTTT deposits into a pot and it wasn’t an issue.

1 Like