How to Get Approved for a Mortgage

Your Mortgage Approval

Your first step should be to speak to a mortgage broker, such as Mortgage One, who can provide guidance throughout the process. Make an enquiry with us, and we will advise you quickly on the right approach for your specific circumstances.

Here are important steps to prepare before you submit your mortgage application:

Save as Much Deposit as Possible

The bigger your deposit, the better your chances of getting approved. You’ll also have access to a wider range of mortgage products. Lenders will require proof of where your deposit originated due to anti-money laundering rules. Evidence such as bank statements, a property sale, or an inheritance may be necessary.

Download Your Credit Reports

Before submitting your application, check your credit reports to ensure all details are accurate and that you’re no longer linked to anyone with whom you had joint accounts. Errors should be corrected, or a note should be added explaining any late or missed payments.

Get Your Paperwork Together

Mortgage lenders will need to see evidence of your income to confirm that you can afford the mortgage repayments. Employed applicants will need to provide their last three payslips, while self-employed individuals must submit 2-3 years of certified accounts. Additionally, you’ll need to provide identification documents such as a passport or driving licence and your last three months’ bank statements.

Find the Right Mortgage Lenders

A mortgage broker can make the difference between success and failure when applying for a mortgage. They can help identify lenders offering the most competitive interest rates based on your unique situation. Mortgage One brokers can assist in finding the right lender, whether you’re seeking a traditional repayment mortgage or require a specialist lender for more complex needs.

What Criteria Do You Need to Meet?

Every lender uses its own criteria to assess mortgage applications, but they typically focus on these key factors:

Your Age

Most lenders require applicants to be at least 18 years old. There’s also a maximum age limit, which could be based either on the age when you take out the mortgage or the age you’ll be when the term ends (often ranging from 75 to 95 years old).

Your Employment Status

Lenders will assess your employment type to determine your income stability. Regular salaried employees may have an easier approval process, while those in non-standard employment (e.g., self-employed or contractors) may face more stringent requirements.

The Type of Property You’re Buying

Purchasing a non-standard property, like a thatched-roof house or a flat above a shop, might limit your mortgage options, as some lenders view these properties as higher risk. However, specialised brokers can help you find a suitable lender.

Your Credit Rating

Lenders review your credit reports to assess your repayment history. A poor credit score may limit your options, but it doesn’t mean you can’t get a mortgage. If your credit is particularly bad, seeking advice from a broker who specialises in bad credit mortgages can help.

The Size of Your Deposit

A larger deposit can improve your chances of getting approved and give you access to better deals. The more you invest in the property, the less risk you pose to lenders.

How Much Do You Need to Earn?

Some lenders have a minimum income requirement, typically ranging between £20,000 and £25,000, but this isn’t a standard across the industry. Lenders consider the broader picture of your finances, including bonuses, pensions, and benefits, alongside your outgoings and credit history. Most lenders offer up to 4.5 times your income, although some may offer up to 6 times.

To get an estimate of how much you could borrow, try Mortgage One’s mortgage affordability calculator, or contact us to speak with a broker who can give personalised advice.

Can You Be Pre-Approved for a Mortgage?

Yes. You can apply for a mortgage pre-approval or an agreement in principle to find out how much a lender is willing to offer before you formally apply. While not a guarantee, it gives you an idea of how much you can borrow.

Is the Criteria Different If You Have Bad Credit?

Lenders have varied criteria for applicants with bad credit, typically considering factors such as:

• The severity of the issue: Minor infringements may not significantly affect your application, while more serious issues like recent county court judgments (CCJs) could.

• The reason for bad credit: Lenders will look more favourably if bad credit resulted from an unexpected event rather than financial mismanagement.

• How long ago the issue occurred: If the issue happened recently, it may reduce your chances of approval. Older credit problems may not have as much impact.

What If You’re Self-Employed?

Self-employment doesn’t disqualify you from getting a mortgage, but lenders typically require more documentation. Most will want to see your income over the last three years, although some lenders may only require two years of accounts. Specialist lenders may accept just one year’s records.