Why approach a mortgage broker?
There is a fair level of ‘legwork’ associated with applying for a mortgage.
- Help you complete your mortgage application form (one application for a number of lenders)
- Indicate exactly what paperwork is required for your personal circumstances
- Submit your application to a wide range of lenders
- Liaise with them on your behalf to secure ‘Approval In Principle’
- Guide you through the whole process from Approval In Principle through to Loan offer
- Secure a Loan offer – reflecting the best possible outcome (in terms of amount borrowed and the rates available)
- Secure your Life Assurance Cover at the most competitive rates
- Assist you with House Insurance Requirements
We can MANAGE all of the above and we act as ONE contact point for the whole process. We are free to take your call anytime and we will continue to manage your application until we secure the best outcome for you.
We are paid by the Mortgage Provider (circa a maximum of 1% of the loan drawdown ) when your loan cheque is issued. We DO NOT charge an administration fee unlike other mortgage brokers.
What a Mortgage Lender looks for in an application
We have set out below the steps involved in seeking and securing a mortgage but firstly it is worth noting what the lenders are looking for when you submit an application to them
- Lenders are keen to see that you can manage your mortgage repayments and still have enough money left to meet all other commitments and enjoy yourself. They will also want to ensure you can handle interest rate increases to your mortgage payments if interest rates do increase along the way. The following are some of the areas they will look at to see if your mortgage application stacks up:-
- Your Income; including any bonuses / overtime or other sources of income. If you have a good consistent income and / or you have two incomes this will strengthen your application.
- Your Savings; It is really important to demonstrate a good strong savings record over 9 / 12 months – it helps to demonstrate your commitment to making regular payments every month. If you are paying rent (and this is evidenced via a bank account) this combined with savings shows the level of commitments you currently have and how this may be ‘repeated’ if you have a mortgage. In addition a good level of savings helps to show the lender that you can meet additional associated costs including deposit, legal fees, stamp duty, furniture and kit out costs etc.
- Your day to day bank activities; Good banking records is always a plus. This means that you should be able to demonstrate that you have managed your monthly commitments in a satisfactory manner.
Other borrowings; If you have other commitments (e.g. credit cards / personal loans) the repayment history should be fully satisfactory and ideally you should pay down these commitments – or as much as you can afford – as additional borrowing is likely to effect the amount you can borrow for your mortgage.
Your Lender doesn’t expect you to be perfect but they do expect you to have a good understanding of the level of commitment involved and welcome your efforts to show them that you are fully aware of the responsibilities that come with a mortgage.
Some Helpful Steps when seeking a mortgage:
- Firstly you should work out much you can borrow from the different lenders. This will give you a good idea of what you can afford before you go house hunting Different lenders can offer different amounts. Whilst there are strict Central Bank Rules there is some scope to offer amounts that might differ from lender to lender. By approaching a Mortgage Broker we can secure the maximum allowable amount that you can borrow allowing you to shop with confidence.
- Start Saving if you haven’t already done so Your Lender will expect to have you put a deposit – typically between 10% and 20% of the value of the property you wish to purchase
- Get all your paperwork in order Your lender will require you to provide paperwork to support your application. The paperwork must be provided with your mortgage application so ideally you will have all the paperwork before you complete a mortgage application form. You should arrange to have the following:
ID for all applicants – generally a Passport or Drivers Licence and a utility bill to confirm your current permanent address. Each PAYE applicant should also provide their latest P60 and their last 3 months payslips and 6 months bank statements for individual (and Joint accounts). Self Employed applicants will also require their last 2 years certified / audited accounts Full details of all savings accounts / investments / loans / credit card statements etc.
If your Loan Offer is approved your Loan Offer Letter will set out any additional requirements including:-
- Life Assurance Cover
- House Insurance
- Details of any other mortgage statements (if other mortgages)
- Secure Approval In Principle This is ideal for House Hunters who have not yet found the perfect house but want to know how much they can borrow if they do see their dream home. An approval in principle is a simple document that indicates how much the lender is prepared to approve in terms of the amount they will allow you to borrow. The approval is typically valid for a period of up to six months. If you do go on to make an offer on a property for a property the Estate Agent will know that your offer is a serious one as you have written evidence of the amount you can borrow.
- Paying a booking deposit When you have decided on the property you will be asked to make a booking deposit. This implies that you wish to purchase the property. You will then to have us secure a Loan Offer so you can complete the purchase of the property on a date agreed with your Solicitor and the Vendors Solicitor.
- The Loan Offer Once you have paid a booking deposit you need to then come up with the monies to complete the purchase of your property. We will secure a Loan Offer which sets out how much you can borrow and on what terms. A copy of the Loan offer will also be issued to your solicitor and they will then agree a closing date (i.e. a date on which you exchange cash and keys!).
- Setting up your Life Cover / House Insurance Before you draw down your Loan Cheque (funds) you will be obliged to have Life Assurance in place – which ensures the mortgage is repaid if you (or your partner if mortgage in joint names) die within the loan term. You will also be required to have House Insurance in place. We can help you set up the Life Cover – we have access to a full range of product providers so we can secure the most competitive cover. We can also give you guidance in relation the House Insurance Cover.
- Drawing down your Loan Funds Your Solicitor will arrange to draw down your Loan Funds approximately one week before you get the keys of your new home. They will transfer the funds to the Vendors Solicitor at the same time as you receive the keys of your new home