Improve Your Chances Of Getting A Mortgage In 2020
With an increased level of optimism regarding the UK housing market, it is inevitable many people will look into buying a home this year. With estate agents and online property portals saying they witnessed an increase in house-hunter registrations¹ after the General Election of December 2019, this year may be the ideal time to step on the property ladder.
Miles Shipside is Rightmove’s director and their housing market analyst, and he spoke about the increase of buyers, saying; “The housing market dislikes uncertainty, and the unsettled political outlook over the last three and a half years since the EU referendum caused some potential home-movers to hesitate. There now seems to be a release of this pent-up demand.”
If you wish to join the influx of people stepping onto the property ladder this year, it makes sense to improve your chances of getting a mortgage in 2020.
Save for a deposit
One of the most significant barriers to homeownership is saving enough money to pay for the deposit. This should be one of the areas you focus on to ensure you achieve your property ambitions.
A sensible starting point is knowing how much you need to save. As a minimum, you need to save at least 5% of the property price.However, the more money you can save to use as a deposit, the better. Lenders offer more attractive mortgage rates when the buyer is able to provide a sizable deposit. If you want to significantly enhance your chances of being accepted for a mortgage, and getting the best possible rate, you need to save a suitable deposit.
Tips to consider include:
- Open a savings account or ISA aimed at raising a deposit
- Review your expenditure and look for ways to lower your spending
- Look for schemes which provide you with cash back when you shop
- Consider ways you can improve your income
- If permissible, consider asking family members for assistance
Improve your credit score
Another important aspect of arranging a mortgage is to have a reputable credit score. Lenders review applicants credit score, and the better the score, the more likely it is the applicant will be accepted and receive an appealing offer.
You should check your credit score with one of the leading agencies which hold files (Experian and Equifax). Both agencies contain different information, so there is no harm in reviewing all three records.
It is helpful to know your score because this makes it easier to assess if you should apply right now. Also, if there are any errors or omissions on your file, have these rectified before you apply for a mortgage.
Other tips to consider in improving your credit score:
- Ensure your correct address is on the Electoral roll
- Pay bills by direct debit
- Ensure your credit cards aren’t close to their limit
- Don’t apply for credit too often
If you follow these tips, you will be in a better place to apply for a mortgage. You should then contact a mortgage broker, and review your options with them. Working with a dependable broker will ensure you see what options you have, and you will receive guidance on what to do next in your application.
Xpress Mortgages has a team of mortgage experts who are happy to help, so please get in touch.