Buying a home can be an exciting time, but it can also be a daunting prospect. For many prospective buyers, arranging a mortgage is the most challenging task. Your mortgage is likely to be the most substantial commitment you make in your life. Therefore, it is perfectly understandable that you will feel apprehensive about the process.

At Mortgage Simplicity, we are pleased to say we have assisted many people and households find their ideal mortgage. By following these steps, and planning the stages, you can remain in control of the process, enhancing the likelihood of enjoying a successful outcome.

 

Start saving money

As soon as you first have the notion of buying a home, it is best to start saving money. The more money you have put aside to use as a deposit, the more likely it is you can receive a favourable mortgage.

Also, the actions associated with saving money, including creating a budget, showing restraint when it comes to spending money, and being consistent with your income, all combine to improve your credit rating hopefully.

 

Pay down debt

If you have debt, it is best to pay down as much as you can before you apply for a mortgage. Mortgage lenders consider the monthly payments on existing loans or credit cards, so the fewer payments you have (in frequency and size), the more appealing your application will be.

 

Review your credit score

An essential step in preparing to apply for a mortgage is to review your credit score. The higher the score in your credit rating, the more likely it is you will receive an attractive mortgage offer. If you don’t have a high mortgage score, don’t panic, because there are still options to consider. However, these may be more expensive, and you may receive limited offers compared to people with an attractive credit score.

 

Take an affordability assessment

An important part of the mortgage process is taking an affordability assessment. Lenders want to know how much money you can afford to pay each month, and this figure will go some way to determining how much of a mortgage they are willing to offer you, and at which terms.

The affordability assessment examines your income, your outgoings, and it considers how changes in the market affect your ability to manage monthly payments. Some applicants may be comfortable in paying a mortgage off today, but if interest rates rise, some people’s circumstances will change, making it harder for them to meet monthly payments.

 

Consider what mortgage is right for you

There are many different types of mortgages to choose from, and one may be more appealing than others. It is best to wait and see what mortgages a lender offers you, but if you have options, you need to make an informed choice on which solution is best for your needs.

 

Obtain a mortgage in principle before you view homes

Before you spend time looking at houses you wish to buy, you should arrange a mortgage in principle. This status provides you with a guideline on which type of home you can afford, and it indicates you are seriously considering buying a home.

Obtaining a mortgage in principle doesn’t commit you to arrange this mortgage, nor does it guarantee the lender will provide you with this mortgage, but it is a valid starting point when looking to buy a home.

If you are looking for guidance in arranging a mortgage, contact Mortgage Simplicity, and we will be more than happy to assist you.