Getting Approved For a Mortgage

In this article, we explain everything you need to know about getting your mortgage application approved, including lenders’ standard eligibility criteria, how they calculate affordability and why using a broker can boost your chances of success. 

How to get approved for a mortgage

Your first step should be to speak to a mortgage broker, who can provide all the guidance you need throughout the process. Make an enquiry with us, and we will match you with one who has the right experience to help with your specific circumstances.

The following are also very important steps to prepare before you submit your mortgage application: 

Save as much deposit as possible

The bigger your deposit, the better your chances of getting approved and the faster the process should take. You’ll also have a wider choice of products and deals. You’ll need to prove where your deposit has come from.

Lenders have strict anti-money laundering rules to ensure money used for mortgage deposits is legitimate. There are various ways to prove where your funds have come from, including bank or savings account statements, evidence of a property sale or proof of an inheritance.

You can still get a mortgage if you have a small deposit of 5%. Speaking to a broker is a good option, as they can find lenders more open to loaning to you if you have a small deposit.

Download your credit reports

Before you make an application, check your credit reports. You should ensure all the details are accurate and that you’ve been delinked from anyone with whom you previously had joint accounts.

If your report contains errors, you have the right to challenge them or, at the very least, add a note explaining any late or missed payments.

Credit reports can be difficult to understand, so if you’re having difficulty understanding yours, using the services of a broker who can break the information down for you will help.

You can click on this link to – download your credit files immediately.

Get your paperwork together

Mortgage lenders will want to see documentary evidence to support the information on your application, particularly relating to your earnings, as this will prove you can afford the mortgage repayments.

If you’re employed, you’ll typically be asked to provide proof of income, such as your last three payslips, and if you’re self-employed, you can include the last 2-3 years of certified accounts. You can still get a mortgage if you’re self-employed and only have a year of certified accounts. A broker will be able to assist you in finding a lender if you find yourself in this situation.

Other documents you’ll need are a copy of your passport or driving licence and your bank statements from the last three months. 

Find the right mortgage lenders

This is an area where a mortgage broker can make all the difference, saving you a lot of time and money. Based on your personal requirements, they will be able to identify the best lenders offering the most competitive interest rates. 

You may require a traditional repayment mortgage for a house move – a situation where lots of mortgage lenders are available, but your broker can help you select the most appropriate. Alternatively, you might need a more specialist lender who can help someone with bad credit or for a specific type of property purchase.

What criteria do you need to meet?

Every lender has its own set of criteria when it comes to assessing mortgage applications, but, in general, they’ll consider the following:

Your age

Most lenders require residential mortgage applicants to be at least 18 years old. They also tend to have a maximum age limit too. This can either be the age you are when you take out the mortgage (typically, the maximum is 75 or 80) or the age you’ll be when your mortgage term ends (this tends to range from 75 to 95).

Your employment status

Lenders will be keenly interested in your employment type. This will help them determine how much and how regularly you’re paid.

If you’ve been employed for several years, receive a regular salary and meet all other lending criteria, you shouldn’t have too much trouble getting approved. If you’re in what’s deemed ‘non-standard’ employment – for example, you’re self-employed, you work part-time, or you’re a contractor – it could be a bit trickier, but not impossible, to get your application approved.

The type of property you’re buying

If you’re buying a non-standard property, such as a house with a thatched roof, a flat above a shop, or a barn conversion, this could be a red flag for lenders because they may have concerns over resale potential if they have to repossess your home in the future.

That’s not to say you can’t get a mortgage if you’re purchasing a non-standard property. You may just have a more limited choice of lender.

Your credit rating

All lenders will look at your credit reports to establish how good you’ve been at paying back loans in the past.

Credit reports contain detailed information about your loan history, including past credit cards, overdrafts, mortgages and mobile phone agreements. They record how much credit you were given and how efficient you were at making the repayments.

You can still get a mortgage if you have black marks on your credit reports. It may, however, impact the range of deals available to you. If you have particularly bad credit, it’s worth seeking advice from a bad credit broker who specialises in securing loans for people in this situation.

The size of your deposit

Lenders will always take into consideration the size of your deposit. Generally, the larger your deposit, the greater the chance of getting your mortgage approved and the more deals you’ll have available. That’s because the more money you invest in the property, the less risky you’ll be.

How much you need to earn

Some lenders impose a minimum earnings requirement of, say, £20,000 – £25,000 on mortgage applicants, but this isn’t standard across the industry.

Most lenders don’t solely focus on annual earnings to determine if you can afford your mortgage. They look at the bigger picture and consider other forms of income – including bonuses, commission, pensions and even benefits – as well as your outgoings, credit history and other credit commitments.

Each lender uses its unique criteria to assess affordability, but most lenders generally offer 4.5 times your income. Some will offer 5 times, and a handful will offer as much as 6 times your income.

To get a rough estimate of how much you’d be able to borrow with your income, try our mortgage affordability calculator here:

For a more accurate figure, speak to a qualified broker who can assess your individual circumstances.

Need help finding a broker? Contact us, and we’ll match you with one from our extensive network. 

Can you be pre-approved for a mortgage?

Yes. If you want to discover your chances of being approved before you start house hunting, you can apply for a mortgage pre-approval or agreement in principle. This is a statement from a lender outlining how much they’re prepared to lend you before you formally apply for a mortgage. While it’s not a guarantee, it gives you a pretty good idea of how much you’ll be able to borrow.

Is the criteria any different if you have bad credit?

Again, every lender will have its own criteria for assessing applicants with bad credit.

However, in general, they’ll typically look at the following:

• The severity of the issue – some infringements will be considered relatively minor and are unlikely to affect your chances of getting a mortgage.
• The reason for the bad credit is that lenders will look more favourably on you as a borrower if your adverse credit history results from an unexpected event rather than ongoing financial mismanagement.
• How long ago was the bad credit registered? – The date the infringement took place will make a difference. For example, you’ll struggle to get approved if you’ve received a county court judgment (CCJ) in the last twelve months. However, if your CCJ was more than three years ago, it shouldn’t impact your chances of getting a mortgage.

What about if you’re self-employed?

Being self-employed won’t prevent you from getting a mortgage. However, you may have to jump through a few more hoops to get approved.

Most lenders base their lending decisions on your income over the last three years. Some will only require two years of accounts, while a handful of specialist lenders will accept just one year.

Get matched with a broker to guide you through a successful application

Getting a mortgage approved is exciting, but the build-up can be a stressful experience. That’s why you should strongly consider seeking advice from an experienced broker who can research and identify the best deal for your circumstances, walk you through the application process and improve your chances of getting accepted.

Our broker matching service can connect you with an expert who can help you today.

Call us on 0330 818 7026 or make an enquiry and get matched with a broker for a free initial conversation.