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Mortgage approval

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Last reviewed on 1st March 2022

Getting a mortgage approved is the first major step in buying a home. A mortgage offer is a formal commitment from your lender that they’ve approved your mortgage.

Waiting on a decision from a lender can leave many of us worried. It can be agonising when you’ve found the perfect home and really don’t want to miss out. That being said, having an understanding of how the mortgage process works can certainly ease concerns.

Whether you’re looking for guidance or simply want to know how to get approved for a mortgage, we’ve got it covered. Our specialists are also ready to answer any of your mortgage questions.

What is the criteria for mortgage approval?

Mortgage approval is assessed on the following:

  • Your credit history – A healthy credit file always makes mortgage approval easier
  • Affordability – Is the mortgage you’ve applied for affordable? This is based on your income and outstanding loans/debt
  • Deposit amount – Is the deposit enough for your mortgage amount and loan to value?

Credit history

Each lender will carry out a credit check at the time of applying for a mortgage. This is so that lenders can gain an insight into how you’ve repaid previous loans. A good credit score can certainly improve your mortgage chances. In comparison, recent credit issues or a low credit score can result in you being declined.

Affordability

Even with a good credit score, your mortgage will need to be affordable. What this means is, your lender will assess your ability to repay the mortgage you’ve applied for. Only once a lender is satisfied that your income and spending habits are sufficient to repay the mortgage, will they agree to approval.

Deposit amount

Before you can get a mortgage, you’ll need to save for a deposit. Although it’s possible to get a mortgage with a 5% deposit, the more you can save the better your chances of approval. This is because lower deposits put both you and your lender at risk, as if house prices fall, it can leave you in negative equity.

Higher deposits can also strengthen your application, especially if you fall slightly short in your affordability and credit checks.

Mortgage approval calculator

Try our mortgage approval calculator to work out whether you’ll be approved for a mortgage. This is an estimate and is based on your income, outgoings and credit file.

For a more accurate idea of whether you’ll be approved for a mortgage, make an enquiry and we’ll be able to guide you further.

How can I get my mortgage approved?

You’ll need to take the following steps to get your mortgage approved:

  • Calculate your affordability to set your budget
  • Set your deposit amount and source of your deposit
  • Check your credit files for any possible issues
  • Apply with a lender and get an agreement in principle
  • Mortgage survey of the property
  • Formal mortgage offer

Getting an agreement in principle before you start your property search has many benefits. For instance, the agreement will indicate how much you’re likely to be offered. You can then plan your property search accordingly. It can be quite disheartening to find a property, only to apply and then be told that you can’t borrow the amount you’d hoped for.

Learn more: How to apply for a mortgage in principle

Should I use a mortgage broker or go directly to a lender?

Both a lender and mortgage broker can help you to get a mortgage. That said, there are differences in how lenders and brokers work. A lender will only ever show you their own products. You wouldn’t find a Natwest brochure in a Halifax bank, which is completely understandable. Lenders just don’t promote their competitors. In comparison, independent brokers will compare deals across lenders.

Shopping around and searching for a great deal is only possible by comparing a number of lenders. Mortgage brokers are different for this very reason. If a broker is independent, then they’re not tied to a single lender. Instead, they can search and compare multiple lenders.

There are thousands of mortgages available with different rates and fees, some with added perks. The odds of you choosing your own lender and getting the best possible mortgage are very slim.

If you apply directly with a lender and they decline you, it’s likely your credit score will take a hit. Mortgage brokers will also check to see if you’re eligible before applying. This simple method can keep your credit file intact. Our advisors certainly don’t apply for mortgages until they’re absolutely certain they’ll be approved.

ask a mortgage broker

How long does it take to get a mortgage approved?

A mortgage takes around two weeks to complete on average. Sometimes mortgages can be finalised quicker or they can take longer depending on whether or not your case is straightforward. Nonetheless, a mortgage shouldn’t take longer than one month to complete.

It’s important to note that a formal mortgage offer is not the same as an agreement in principle. A mortgage in principle can usually be provided in a matter of hours, if not minutes, depending on how urgently you require the document. The turnaround time also depends on how fast you can compile your documents ready for a broker.

There are certain factors that can either speed a mortgage up or slow the process down. You should also advise your broker on how urgently you need a mortgage. This is especially true if you need to meet a deadline for your home purchase.

Read more: How to get a fast mortgage

How difficult is it to get a mortgage approved?

While it may be easy for one person to get a mortgage approved, it can be difficult for somebody else. This is because lenders assess each case individually, as each borrower’s circumstances are never the same. You may also qualify with various lenders, but be declined elsewhere. Lenders will make assessments on your circumstances which will indicate whether they’ll approve your mortgage or decline it.

What documents will I need to start a mortgage application?

As a rule of thumb, you will need to provide the following before a mortgage can be approved:

  • Proof of identity – Either a passport or driving licence
  • Evidence of income – Such as payslips or accounts/SA302 if self-employed
  • Proof of address – A utility bill is ideal
  • Evidence of outgoings/outstanding loans – Bank statements can show both
  • Proof of deposit – A bank statement or gifted deposit letter can show your deposit amount and source

Depending on your circumstances, you may have to provide further information. For instance, if you’re a buy to let landlord, it’s likely you’ll have to provide tenancy agreements to satisfy any concerns from underwriters. In contrast, if you’re a contractor, lenders may want to see evidence of future work contracts you’ve secured.

Read our mortgage checklist here.

Is it possible to get a mortgage online?

Our advisors offer the facility for borrowers to make online mortgage applications. By using the latest financial technology, it’s possible to get a mortgage online, in the comfort of your home. Documents can be sent online and your advisor can explain everything to you.

Learn more about online mortgage applications here.

How to speed up the time it takes to get approved

Factors that can help you get your mortgage approved quicker are:

  • The speed at which you can gather the requested documents, such as photo IDs and bank statements
  • How long your mortgage broker takes to submit the mortgage application
  • The time it takes the underwriter to assess your application
  • The speed at which the surveyor can complete the mortgage survey

Borrowers with simple circumstances may find that their mortgage is approved faster when compared to borrowers with difficult circumstances.

For instance, applications that involve bad credit or applicants that are self-employed can take longer to process. This is because underwriters may request additional information, which can delay your mortgage from being completed.

Your mortgage advisor will also need more time to gather information and research your personal circumstances to ensure that the right lender is approached.

Mortgage cases are never the same and the time it takes to complete your mortgage will largely depend on your circumstances.

Remember, you can ask our advisors for help at any time. If you’re still unsure or want to apply for a mortgage, our specialists are ready to help.

Do I need a property survey to get a mortgage?

The property you wish to buy will undergo a mortgage survey. This is so lenders can establish whether or not the property meets their criteria. For instance, most lenders will only lend on properties of standard construction and those that don’t need extensive refurbishment.

Even if the property isn’t made from regular materials, there are other alternatives such as refurbishment finance, which can be used for homes that aren’t eligible for a mortgage. You can check with an expert advisor to see if you’re eligible for a mortgage. If you do qualify, the entire process can be done online.

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About the author

Mortgage Advisor | More Articles

Martin is a senior mortgage advisor and has held a CeMAP qualification for over 15 years while also completing an MBA in Global Banking & Finance.