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5 tips to boost your mortgage chances

With the recent changes to the rules around shared ownership giving more people the opportunity to get on the housing ladder we spoke to Justin Massey of Index Mortgages Limited. Justin is a mortgage and protection advisor and has helped countless people through the process of buying shared ownership properties over the last 15 years. Here he gives some tips on what lenders look for when you apply for a mortgage to buy a shared ownership home. 

The new rules have opened the door to more people than ever before to buy a shared-ownership property - but the flip-side to that is lenders are becoming increasingly strict on who they lend money to. So here are a few tips to help you get ready if you're thinking of buying a shared-ownership property over the next few months.

Number 1First things first - make sure you can show lenders that you can manage your money. This might sound obvious but you'd be surprised how many people I've seen whose bank statements show that they regularly go overdrawn. Even if it's only by a small amount, this could be frowned upon by lenders as they might assume it from your statement that you're not able to manage your finances. Another important thing to consider is to make sure that you pay all of your bills on time - any red mark on your record can contribute to you not being accepted for a mortgage.

Number 2Check your credit file - it's important to make sure that this is clear as lenders use this information to make decisions on whether you get a mortgage or not. Lenders look at credit reports to decide whether or not to approve customers for loans and mortgages. Your credit file gives a picture of how trustworthy you are when it comes to paying back money. It takes into account credit card repayment history, the frequency of credit applications and how often you've changed address so it's really important that your information is correct before applying for a mortgage.

You can find out more about this and how you can check your credit file for free on the money saving supermarket website.

Number 3Make sure that you're registered on the electoral roll - many people don't realise that not being registered to vote can really hurt your chances of getting a mortgage. Not being on the full register can make it difficult to get any kind of credit as it can cause tracing and identification issues.

If you need to register to vote, you can do so by clicking here.

Number 4A mortgage will usually be the largest loan most of us will ever apply for so it's crucial to show lenders that you're not taking the decision lightly. To give yourself a better chance of getting a mortgage, we recommend that you don't apply for any other type of credit in the three months prior to applying for a mortgage.

 

Number 5Your bank statements tell the story of your spending so it's essential that you keep them as clean as possible. With the rise of online gambling, many people now have accounts with bookmakers but this is something that could be frowned upon by lenders. Regardless of how much you spend on gambling it can be seen as risk and as such, could harm your chances of being accepted for a mortgage.

The same principle applies to payday loans - from a lenders point of view, if you can't afford to manage day-to-day how will you afford to pay back the biggest loan that you'll probably ever have?

 

If you stick to this simple advice you will give yourself a far better chance of being accepted for a mortgage.

These tips are just a guide and everyone's circumstances are different so I would advise you to talk to a financial advisor to get the best advice for you. 

 

17 March 2016