How to get a mortgage

If you’ve bought a house, how did you find the application process for your mortgage?

2 Likes

Slow

Having just gone through all of this, I’d say most of it was good advice.

But… We were discussing this elsewhere earlier on…

Improve your credit score

Mortgage providers like to see that you have a good credit score. This reassures them you’ve been a responsible borrower in the past. There are many ways to improve your credit score – including paying bills on time, staying below your credit limits and registering to vote. Try not to apply for mortgages (or any other credit) more than once over a short space of time, as each application will temporarily lower your score.

Firstly, your completely made up credit score would appear to have very little impact on your ability to get a mortgage (this is the information two different mortgage providers gave me).

They will do a “hard search” on your credit file, but they have their own teams of people who look through things, and your “affordability” is significantly more important (incoming vs outgoing).

Secondly, given this advice from Monzo, it would be great to get an update on the plan to report to all 3 credit reference agencies.

The Nationwide mortgage I’ve just taken out didn’t search on Transunion (Noddle) at all, and only searched Equifax and Experian.

If I was a first time buyer who only had a Monzo account and not many other commitments, it would raise some flags if they couldn’t find a single account for me (again, it shouldn’t matter, but seeing as it’s in the Monzo blog… probably worth addressing).

Ultimately, the biggest thing from my experience is to try and reduce your regular outgoings by as much as possible for the 3 months prior to you applying for a mortgage.

You can start them again once you’ve been approved!

Also, try and limit things like gambling, as this just causes more hassle than it’s worth (even if you win).

The article also didn’t talk about product fees.

Some will include a product fee of (usually), £999 - Which will result in a lower monthly rate.

Right now, it’s better to go for that option over the rate with no product fee.

The absolute cheapest way to do this is to pay the £999 up front.

But, even if you add it to the mortgage (which you can do), you only end up paying back £999 plus interest - Which right now, is tiny. You are effectively getting a £999 loan for around 2% (or whatever your interest rate is).

You can also (usually) overpay on the mortgage, so you could pay £500 in month 2 and £500 in month 3 to clear that initial product fee.

Most “advice” sites advise against taking the product fees, because when the interest rates were higher, it didn’t make sense (at least, that’s what I found when I was looking recently, because the articles were all dated from 2010 - 2015 ish).

Last tip…

Most solicitors won’t need to see you, and will accept a “certified” copy of identity documents.

All the solicitors in my area were quoting £500 ish for this… But I called some “up north”, and the average price was £400 :smiley:

5 Likes

I went to a great mortgage advisor and she did everything for me. Didn’t cost me anything and I got £1000 cash back which went towards the solicitor fees. Was really a painless experience and I got a Christmas card! :evergreen_tree: lol

1 Like

Reporting the all theee credit agencies is a must for me. I keep my joint account with a legacy purely for this reason.

Also there are some great fintech mortgage companies out there like Habito. Use Quidco and you get great cash back and the service is very modern unlike many other banks.