Buying a home is a major financial commitment, and getting your mortgage application right can make a big difference to how smoothly the process goes.
Whether you are a first-time buyer, moving home, remortgaging or looking to buy a new build, preparing your finances before you apply can put you in a stronger position.
Here are 15 practical mortgage tips to consider before starting your application.
1. Understand Your Budget Before You Start Looking
One of the biggest mistakes buyers can make is looking at properties before understanding what they can realistically afford.
Your mortgage budget is about more than the maximum amount a lender might offer.
You should also consider whether the monthly payments are comfortable alongside your other financial commitments and everyday expenses.
Understanding your budget early can help you focus your property search and avoid looking at homes outside your realistic price range.
2. Save as Much Deposit as You Can
A larger deposit can potentially give you access to a wider range of mortgage options.
Your deposit also determines your loan-to-value ratio, which can influence the mortgage products and interest rates available to you.
However, it is important not to put every penny of your savings into your deposit. Remember to allow for other costs associated with buying a home.
3. Check Your Credit Report
Before applying for a mortgage, it can be useful to check your credit report.
Look for any errors or information that needs updating.
You should also understand your current credit position, particularly if you have previously experienced financial difficulties, missed payments or other credit issues.
Addressing potential problems early may give you more time to understand your options.
4. Avoid Taking on New Credit Before Applying
If you are planning to apply for a mortgage, think carefully before taking out new loans, finance agreements or credit cards.
New borrowing can affect your affordability assessment and may change how much a lender is willing to offer.
If you are already going through the mortgage process, speak to your mortgage adviser before making significant changes to your finances.
5. Keep Your Finances Stable
Lenders will look at your income and financial commitments when assessing your mortgage application.
Avoid making unnecessary financial changes immediately before applying.
This can include changing jobs, taking on new borrowing or making significant changes to your regular outgoings.
If you are considering a major change, discuss it with your mortgage adviser first.
6. Get Your Documents Ready
Having your paperwork organised can help your mortgage application progress more efficiently.
Depending on your circumstances, you may need documents such as:
- Proof of identity
- Proof of address
- Payslips
- Bank statements
- Proof of deposit
- P60s
- Tax calculations
- SA302s
- Business accounts
The documents required will depend on your circumstances and the lender.
7. Get a Decision in Principle
A Decision in Principle, sometimes called an Agreement in Principle or Mortgage in Principle, can give you an indication of how much you may be able to borrow.
It can be useful when you are looking for a property because it gives you a clearer idea of your potential budget.
It is important to remember that a Decision in Principle is not a mortgage offer and is subject to the lender completing its full assessment.
8. Don't Automatically Choose the First Mortgage You Find
There are many different mortgage products available, and the cheapest-looking option is not necessarily the most suitable for your circumstances.
Consider the full picture, including:
- Interest rate
- Mortgage term
- Product fees
- Early repayment charges
- Flexibility
- Overpayment options
A mortgage adviser can help you understand the differences between available options.
9. Think About the Future
Your mortgage is likely to be a long-term financial commitment.
Think about how your circumstances could change.
For example:
- Could your income change?
- Are you planning to start a family?
- Could you move home?
- Are you expecting to retire during the mortgage term?
It is important to consider whether the mortgage remains affordable if your circumstances change.
10. Don't Forget the Other Costs of Buying a Home
Your deposit and mortgage payment are not the only costs involved in buying a property.
You may also need to budget for:
- Solicitor’s fees
- Mortgage fees
- Valuation costs
- Surveys
- Moving costs
- Insurance
- Stamp Duty Land Tax, where applicable
- Repairs and maintenance
Make sure you understand the full cost of buying before committing to a property.
11. Be Careful With Your Property Budget
Just because a lender is willing to lend you a certain amount does not necessarily mean you should borrow the maximum available.
Consider your lifestyle and monthly budget.
A slightly cheaper property may leave you with more financial flexibility for holidays, savings, unexpected expenses and future plans.
12. If You're Self-Employed, Prepare Early
Self-employed mortgage applications can sometimes require more documentation.
Depending on the lender, you may need to provide evidence of your income and trading history.
Many lenders prefer two years of self-employed history, although some may consider applicants with one year.
If you are self-employed, getting advice early can help you understand what information you may need.
13. Don't Make Major Financial Changes During Your Application
Once your mortgage application has been submitted, your circumstances still matter.
Avoid making significant financial changes without speaking to your adviser.
This could include:
- Taking out new credit
- Changing employment
- Increasing debts
- Missing payments
If something changes unexpectedly, tell your adviser as soon as possible.
14. Start Early If You're Remortgaging
If your current mortgage deal is coming to an end, don’t leave reviewing your options until the last minute.
Starting early gives you more time to consider whether you should:
- Stay with your existing lender
- Switch to a new lender
- Change your mortgage term
- Raise additional funds
- Review your overall mortgage strategy
Planning ahead can help you avoid unnecessary pressure as your current deal approaches its end.
15. Get Professional Mortgage Advice
Every mortgage application is different.
Your income, deposit, credit history, employment status and future plans can all affect your options.
A mortgage adviser can help you understand your circumstances, assess your affordability and guide you through the application process.
At Humble Mortgages, we provide clear and personal mortgage advice for customers in Norwich, Norfolk and across the UK.
Whether you are buying your first home, moving house, remortgaging or looking for a specialist mortgage, we can help you understand your options.
Mortgage Tips FAQs
How early should I prepare for a mortgage?
Ideally, start preparing before you begin seriously looking at properties. This gives you time to review your finances, check your credit position and understand your potential borrowing.
How much deposit do I need?
The deposit required depends on the lender, mortgage product and your circumstances. Some mortgages may be available with a smaller deposit, while a larger deposit may give you access to different options.
Should I check my credit report before applying?
Yes. Reviewing your credit report can help you identify errors or potential issues before you apply for a mortgage. It can also give you a clearer understanding of your current credit position and allow you to address any inaccuracies before making a mortgage application.
You can check your credit reports with CheckMyFile, which allows you to view your credit information in one place.
Is a Decision in Principle a mortgage offer?
No. A Decision in Principle is an indication of how much you may be able to borrow based on the information available at that stage. A full mortgage application and lender assessment are still required.
Can I get a mortgage if I'm self-employed?
Yes. Self-employed applicants can get mortgages, although lenders may assess income differently depending on the business structure and trading history.
Get Mortgage Advice in Norwich & Norfolk
Preparing for a mortgage does not need to be complicated.
By understanding your finances, getting your paperwork ready and seeking advice early, you can approach your mortgage application with greater confidence.
At Humble Mortgages, we offer personal mortgage advice across Norwich, Norfolk and the UK, helping you understand your options and navigate the mortgage process.
Ready to start your mortgage journey?
Speak to Humble Mortgages today to discuss your circumstances.
