Mortgages are basically essential for anyone buying a family home. If this is your first ever house, then you’ll most certainly need a mortgage. Some people are still a bit confused by what one of these is, but it’s effectively just a loan. You borrow money to help pay for your house, then you repay it over the years.
Before you buy a house, you’ll need to apply for a mortgage. Now, there’s no guarantee that you’ll be accepted. Some lenders don’t want to give you any money because they don’t trust you. Naturally, you can’t afford for this to happen to you. Before you apply for your mortgage, make sure you do these three things:
3 Things To Do Before Applying For Your Mortgage
Deal With Any Debt
Debt can be a big problem for anyone that wants a mortgage. Lenders are cautious when giving money to people in debt as they worry you can’t pay them off. After all, you’re already paying another debt off, so how can you cope with the mortgage on top of that?
Consequently, you need to try and reduce your debt as much as possible. Lots of techniques and options present themselves to you in this situation. One idea is to enter an IVA to try and consolidate your debt. If you’re wondering, what is an IVA? Then the brief rundown is that it’s a way to agree on debt repayments with your creditor and freeze the interest rates. You may also consider debt consolidation loans or any of the other debt management methods. If you can reduce the debts on your account, then you stand a better chance of being approved by a mortgage lender.
Get A Secure Job
Mortgage providers will always look at your occupation when you make an application. Why? Because they want assurances that you earn enough money to deal with this massive loan. Ideally, they’re looking for people with secure, full-time, jobs.
For this reason, it can sometimes be hard for freelancers to get mortgages. There are some available for people in this situation, but you have to work extra hard to prove that you earn enough and that your occupation is secure. If you – or your partner – have a secure job, then that’s another tick in favour of your application.
Improve Your Credit Score
Credit checks are part and parcel of mortgage applications. Again, lenders want to check if they can trust you with their money or not. Your credit score is the simplest way of understanding your financial habits. Low scores show you’re not great with money, while high ones show you are creditworthy.
As such, improve your credit score before submitting your application. I’ve already mentioned one way of doing this; reducing your debt. There are lots of other ideas as well, and the video above shows you some of the best and most effective tips.
If you do all three of these things before submitting your application, then there’s more chance of getting a mortgage. Now, you’ll have the money you need to buy your first family home!