So you want to buy a house? Congratulations! This is an exciting time for you. A house purchase is likely to be one of the most expensive purchases you make in your lifetime and the most stressful. Most people utilize a mortgage facility to make the purchase, and with a deposit, you have likely saved for a while, you can finally make the dream a reality. But there is a lot to the mortgage application that you might not realize, and certain things you may think are not an issue might cause hold-ups with your mortgage application. You would think it would be straightforward, but some people can make minor oversights that can cost them the best deals and even the total mortgage. With that in mind, here are the three things that could affect your mortgage application.
1. What is recorded on your bank statement?
One of the big things that people don’t consider when it comes to their mortgage application is that they request at least three months’ bank statements from you. They are looking for a few things, which are:
- Whether you are using an overdraft facility consistently and how much of it you might be using.
- What you are spending your money on. Specifically looking at things such as betting and gambling. They don’t like to see these transactions on your bank statements.
- Income and outgoing transactions. So how much is left after all your outgoings and whether you are spending more than what you are earning?
If you want to avoid this causing you an issue, a great tip is to ensure that you give your bank account an overhaul at least three months before you plan to put in a mortgage application. Ensure you avoid using an overdraft facility, and be mindful of the transactions that could be recorded.
2. How long you have been at your job and can you prove your income?
Another thing to think about would be how long you have been in your job. This is another way that a mortgage company can assess consistency. So if you have been in your position for more than six months, this makes you look like a more stable applicant. However, be mindful that you might need to provide your previous employer’s details if it is less than two years. You will need to provide history for the entire two years, so if there has been a fair few jobs, this might go against you. It is also worth remembering that you will need to prove your income through paycheques. Make sure you don’t inflate any earrings as they will want to see the proof.
3. What is your credit score and credit history?
Finally, your credit score and history are also things that a mortgage lender will look at. If possible, try and clear debts and avoid missing any payments for a good while before applying for your mortgage. The better your credit score and history are, the better.
Let’s hope these tips help you with your mortgage application.