How to apply for a mortgage

Want to apply for a mortgage? It’s time to get organised. Find out what you need to apply and how to take the first steps to owning your own home.

Want to apply for a mortgage? It’s time to get organised. Find out what you need to apply and how to take the first steps to owning your own home.

Daniel Evans
Mortgages expert
minute read
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Posted 26 APRIL 2021

Will I be able to apply for a mortgage?

First things first: can you get a mortgage? A lender will only offer you a mortgage if they’re confident you’ll be able to afford the repayments. So, before you start your application, it makes sense to get an idea of your eligibility.

To check whether or not you can afford a mortgage, lenders will look at your income and outgoings, as well as whether you could continue to make the mortgage repayments if something changed – for example, if the interest rates rise.

Find out more about mortgage eligibility

You’ll also need to have saved enough of a deposit to buy a property. The more you can save, the more equity (or ownership) you’ll have in your property. Having more equity means you might be able to get a more competitive mortgage deal, which could mean lower monthly payments.

Get an idea of how much you could borrow and what it might cost, with our easy-to-use mortgage calculator.

How to prepare for your mortgage application

There are a few things you can do ahead of time to give your application the best chance of success.

  • Make sure you’re on the electoral roll – this helps lenders confirm your identity and check your credit record.
  • Check your credit score and have any mistakes corrected. You can do this for free with the major credit reference agencies - TransUnion, Equifax and Experian - as well as some banks. See more on free credit checks.
  • If you’re making a joint mortgage application, have the other person check their credit record too.
  • Get your finances in order – cut down on any unnecessary borrowing, make sure all your bills are paid on time and cut back on your outgoings so lenders can see that you have enough money to afford a mortgage.
  • Don’t apply for other loans or credit cards around the time you make your application. This could be a cause for concern for lenders as they’ll think you’re struggling with your finances.

Where can I apply for a mortgage?

You can apply for a mortgage from a bank or building society, or you could go through a mortgage broker or financial adviser. They can help you find the right type of mortgage for you.

Can I apply for a mortgage online?

Yes, it’s also possible to make an online mortgage application, but if you’ve never applied for a mortgage before you might want to get advice from a professional. Our partners London & Country Mortgages can provide you with fee-free mortgage advice.

Go to L&C Mortgages

What are the stages of applying for a mortgage?

There are two main mortgage application stages: getting an Agreement in Principle, also known as a ‘decision in principle’, and making a full mortgage application.

Agreement in Principle
This is a statement from a mortgage provider giving you an indication of how much they’ll lend you, based on your financial details. Having an Agreement in Principle shows estate agents that you’re serious about buying a property. Some will insist you have one before they’ll show you around houses. Once you have your agreement in principle, you’ll be able to progress to a full mortgage application when you find a property you want to buy.

Mortgage application
At this stage the lender will carry out an affordability check, which includes a full credit check – meaning they’ll be able to see all your bank and credit card accounts, plus any other activity linked to credit that you’ve had in the past. This could include any outstanding loans or utility bills. A lender will also be able to see if you’ve made repayments in full and on time.

When to apply for a mortgage

Estate agents might ask that you have an Agreement in Principle before they’ll show you properties, so you may want to apply for one before you start your search for a home. Bear in mind that Agreements in Principle usually last for 90 days, so if you haven’t found your dream home by then, you might have to apply for another.

What do you need to apply for a mortgage?

You’ll be asked to provide relevant paperwork to support your application. This is likely to include (but isn’t limited to):

  • Proof of name and address: typically, a full UK driving licence or passport. Plus, a recent utility bill.
  • Bank statements: usually your three most recent monthly bank statements.
  • Employment details: with proof of your income.
  • Payslips: for the past three months
  • Evidence of the deposit you’re putting towards a property.

You might also need to show a lender other financial details, such as child maintenance costs or personal expenses.

They may also want proof that you’ll be able to keep up repayments if interest rates rise, particularly if you have a variable rate mortgage.

What do I need to apply for a mortgage if I’m self-employed?

As well as proof of your name and address, and other financial details, if you’re self-employed you’ll need to provide:

  • Two or three years’ accounts from an accountant.
  • Tax form SA302.
  • Other evidence of your income, like bank statements.

Applying for a first-time buyer mortgage

Generally, first-time buyers should aim for a deposit of at least 10% of the property’s purchase price, if possible.

There are several government-backed schemes to help first-time buyers get on the property ladder, including:

  • Help to buy: Equity Loan – the government lends homebuyers up to 20% of the cost of a new-build home in England.
  • Help to buy (Wales) – shared equity loans of up to 20% for buyers of new-build homes.
  • Starter home scheme – this aims to give first-time buyers the chance to buy a new home at 20% less than its market price.
  • Right to buy – council tenants who currently rent could be given support to buy the home they currently live in.
  • Shared ownership – offers buyers the chance to co-own a property with a landlord.
  • Lifetime ISA – this is a type of savings account that can be used to buy a first home (or for retirement).

For more details, see our guide to first-time buyer mortgages.

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