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10 things that could ruin your mortgage chances

Boost your mortgage chances with these application tips

Getting approved for a mortgage can be challenging, but there are steps you can take to boost your chances.

Here, we reveal 10 things that could affect the likelihood of you securing a mortgage, and offer tips on how to overcome them.

1) Having large amounts of outstanding debt

Generally speaking, it is possible to get a mortgage with credit card debt.

Lenders may be reluctant to grant you a mortgage, however, if you have large amounts of outstanding debt from personal loans and credit cards.

This is because having to pay off other loans will directly impact how much (and whether) you can afford your mortgage repayments each month.

For this reason, it’s really important to pay down as much debt as possible before making a mortgage application.

While your student loan will not be considered the same as other forms of debt, your lender may take it into account when working out whether or not you can afford to take out a loan. Read will my student loan affect my mortgage? to find out more.


2) Having a bad credit score

If you’ve got a bad credit history, County Court Judgements (CCJs), or a bankruptcy on your record it can be really difficult to get approved for a mortgage.

This is because lenders use your credit history to judge your ability to stay on stop of debt.

Missing or making late payments on a previous mortgage, loan, credit card or even your mobile phone bill could potentially scupper your chances of being accepted for a mortgage.

All hope isn’t lost if you have an adverse credit history though, as it may be possible to get approved for a bad credit mortgage.

However, rates on bad credit mortgages can be high, so it may be better to spend time improving your credit score and then applying for a regular mortgage.

Talk to an independent mortgage broker such as Which? Mortgage Advisers (0800 197 8461) for advice on the best course of action for you.

3) Having no credit history at all

Applying for a loan with limited or no credit history is a bit like applying for a job without a CV.

Since your credit score lets lenders know how reliable you are at making repayments and handling your debt, you’ll need to have some form of history to be approved for such a large loan.

It’s important to check your credit score before applying for a loan and, where possible, take steps to build up a good credit score before making a mortgage application.

4) Not being on the electoral roll

The electoral roll allows lenders to verify your identity quickly. Not being registered will make it difficult for a lender to confirm who you are.

This could slow down the mortgage application process, as your lender will probably request additional identification checks, and it could even result in your application being rejected altogether.

The good news? Getting on the electoral roll couldn’t be simpler; all you have to do is fill out a form using the register to vote service on Gov.uk.

5) Buying a ‘non-standard’ property

The type of property you’re looking to buy could affect the success of your mortgage application.

Ex-local authority housing, for example, can be appealing as these types of home are often cheaper than others on the open market. Most lenders, however, are reluctant to grant mortgages on this type of property as they are considered more likely to lose value over time.

Similarly, you may find it difficult to get a mortgage for a flat above commercial premises like shops, pubs or restaurants, as they are at a greater risk of being affected by things like noises, smells, rubbish and security issues, which can also bring down the value of the property.

For more information check out our story, 16 properties to avoid if you want to get a mortgage.

6) Trying to borrow too much money

It’s important to do the maths and be realistic about how much money you can afford to borrow.

Typically, mortgage lenders will only lend a maximum of four-and-a-half times the combined annual income of you and anyone else you’re buying with. Asking for a loan above this threshold will likely result in your application be rejected – and you may well find that you’re offered less than the maximum.

7) Being self-employed

Mortgage providers can be reluctant to approve a loan to self-employed workers.

This is because, without a contract of employment or regular payslips, it can be difficult to prove that you’ll be able to keep up with mortgage repayments.

If you’re self-employed and are hoping to buy a home, it’s vital to compile documents proving your past income and future opportunities for payment. Most lenders will want to see at least two years’ worth of accounts.

8) Major lifestyle changes

Going through major lifestyle changes that could affect your finances, such as starting a family or going through a divorce, could negatively affect your mortgage chances.

Some lenders may partly base their decision on whether and how much to lend you on childcare fees, for example. Find out more in does having children ruin your mortgage chances?

Similarly, if you are expecting a child and going on maternity leave at the time of applying for a mortgage, lenders may be wary of how much you’ll be able to afford if you’re expecting a decrease in income. Read our guide on getting your mortgage when pregnant for more information.

And if you’re hoping to get a mortgage after getting divorced, it’s important to re-evaluate your financial circumstances, especially if you’re buying alone. Our guide on selling a house in a divorce shares everything you need to know about securing a new home.

9) Errors on your application

Lenders scrutinise every mortgage application with a close lens, so it’s really important to make sure all of the information you give your lender is correct and up-to-date.

Any discrepancies or inaccuracies on your application could not only slow down the loan process, it could also result in your loan being turned down altogether.

10) Applying to the wrong lender

So your finances are in great order, your credit score is impeccable; everything should be smooth sailing, right? Not always.

Each lender will have its own affordability criteria and may place more weight on certain factors. For example, while some lenders may be more willing to accept applications from households with growing families or self-employed applicants, others may have more rigid criteria.

It’s important to find the lender most likely to accept your financial and personal circumstances the way they are – and this is where the expertise of a mortgage broker can really help.

Speak to the experts

Whether you’re a first-time buyer or home mover, applying for a mortgage can be a stressful and daunting prospect.

Speaking to a mortgage broker can not only help you find the best mortgage deals, but also find the most suitable lenders for your personal and financial circumstances.

Get in touch with our friendly team of experts by calling Which? Mortgage Advisers on 0800 197 8461 or filling in the form below for a free callback.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

Categories: Money, Mortgages & property

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