Securing a deposit for your first house (or benefiting from a gifted deposit) is indeed one of the most challenging steps in the home buying process. But once you’ve overcome this obstacle as a first time buyer in Manchester and decided to dive into the property market, you need to gear up for the impending mortgage procedure.

Know Where You Stand

Drawing from our vast experience as mortgage consultants in Birmingham, we recommend you to contact a mortgage broker in Manchester at the earliest. Your designated consultant will assist you in approximating the amount you might be eligible for and predicting potential monthly mortgage payments. But before any of this, make sure you possess an accurate recent credit report.

It’s fundamental to eliminate any credit-related issues, such as delayed payments on phone contracts, that might hinder your mortgage procurement. Your credit report can shed light on any harmful factors that might affect your application.

Preparing adequately and having a clear understanding of your budget and potential mortgage success can help streamline your financial obligations and ensure you’re organised.

Getting Organised For a Mortgage

Our committed mortgage advisors in Birmingham can bag you a completely credit-checked ‘agreement in principle’ within 24 hours of your first mortgage appointment. As a future home owner, you will need to collect significant paperwork. Organising the required documents in advance can expedite the mortgage application process.

Proof of ID

As part of the procedure, you need to authenticate your identity with a photographic ID like a driving licence or passport.

Proof of Address

Also, you need to provide valid proof of your current residential address. This can be done by providing a utility bill or an original bank statement from the past three months.

Last 3 Months’ Bank Statements

Your income and spending pattern play a critical role in determining your mortgage eligibility. It’s a key factor that lenders evaluate to decide if you’ll meet their criteria. Your bank statements should accurately reflect your income and recurring expenses.Lenders aren’t likely to favour an account that shows any gambling transactions or habitual overdraft limit crossing or frequently bounced direct debits. Therefore, planning and organising your bank statements in advance can enhance your chances of securing a mortgage.

Proof of Deposit

You will need to authenticate your financial ability to save and pay for the deposit. Remember, recurrent money transfers between accounts may complicate the audit process. Lenders appreciate a gradual accumulation of your saving funds, so be ready to offer proof of any large deposits. Often, deposit funds are a family gift, which needs to be proven with a signed letter from the giver stating that the funds are a gift, not a loan.

Proof of Income

To prove your financial capability to repay a mortgage, you must furnish evidence of your salary. Regular employees must provide payslips from the previous three months and their latest P60. Lenders may factor in overtime, commission, shift allowance, and bonuses. Self-employed borrowers in Birmingham should seek their accountant’s help in requesting ‘tax overviews’ and ‘tax calculation’ documents from HMRC for the last 2-3 years as proof of income.

Predicted Expenses

Preparing for a mortgage in Birmingham involves careful financial planning and predicting future expenses. Make a list of all potential expenses, including but not limited to council tax, utility bills, food and drink, and entertainment. This will give you a clear idea of the amount you can allocate towards the monthly mortgage payments.

While it may sound daunting, the steps above are essential requirements of any lender or broker. Once these are ticked off your checklist, you move closer to realising your dream of homeownership. Be proactive and compile everything you may need to convince a lender. This will save you from last-minute stress and hassle, while accelerating your path to getting the keys to your first home.

Date Last Edited: November 8, 2024