Home loans have been falling in numbers for almost half a decade now; however, there seem to be some positives on the horizon. Recent figures suggest that the number of loans has returned to reasonably high levels; however, it’s still tough out there. So, let’s take a look at how you can beat the squeeze and get a home loan.
Fraud is a big issue when looking for a mortgage and being on the electoral roll will help you out greatly in such a scenario. Though you may never vote, just register as it will show lenders that you’ve lived at one address for a period and are whom you say you are.
Students for instance should stay registered at their parent’s address when at college as it shows stability and that they lived at one address for a long period.
If your postcode is not correct on the online application then you will end up with an automatic rejection. People who live in flats often find this an issue as a flat is registered as ‘top flat’ for instance, but on the registered Post Office form is ‘Flat B’. This confusion will cause an automatic rejection.
If you have a big deposit you will be more likely to get a mortgage. A 25% deposit will get you close to the best rates and a 40% one will get you the very top. However, anything in between will get you a preferential interest rate.
The credit score is a huge part of the mortgage and you should check it before you go for a mortgage to ensure that all the details are correct. People tend to find that there are items on the credit score that are incorrect and can have an adverse effect on their mortgage chances. Check it out first.
Improve the Record
If you don’t have a credit card, get one anyway. Using them once or twice a month and then paying them off in full before you apply for a mortgage is a good way to strengthen your score and prove you can payback.
Also, note that failed applications for credit cards go on your record and will cause problems for you buying a new home. Avoid these and check your record first before you apply for credit of this sort. With a good score, if you wish to move and sell your house fast and then remortgage on a whim it will be easy.
Just as lenders like to see stability in where you live, they also like to see stability at work and you will have a greater chance of getting a mortgage if you have had the same job for a period. Like that, those who are commonly headhunted are also a good bet to get a mortgage as they are much in need.
So, follow the aforementioned advice and get that elusive mortgage and that first home.