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Our 10 tips to ensure you stay mortgage ready

With interest rates currently at record lows, it’s important to ensure you and your finances are in the best condition to secure a mortgage. Understandably, you may be concerned whether the Coronavirus (Covid-19) crisis could affect your chances, especially if your financial situation changes. We’ve listed ten tips to help with your application, for whenever you’re ready.

1. Speak to our fee-free New Home Mortgage Advisers

Navigating the world of mortgage deals can seem overwhelming, particularly in these uncertain times. Our New Home Mortgage Advisers are the leading experts in new homes and will research the market for you. They have access to special rates you may not find through high street banks and can advise on the best mortgage for you as a fee-free service.

2. Consider the Help to Buy scheme

If you’re a first time buyer you may only need a 5% deposit to buy a new home. Many different lenders have competitive rates available through Help to Buy, including challenger banks and specialist lenders. Use our calculator to see how the scheme could work for you, then find your dream David Wilson home within budget.

3. Check your credit score

A strong credit score tends to make you more attractive to mortgage lenders. If you’ve recently taken a payment holiday, rest assured this won’t affect your score. As many as 70% of people don’t know their score, however it’s quick and easy to check online with the two main credit reference agencies, Experian and Equifax. Make sure all the information they have for you is correct and, if it isn’t, ask them to change it.

4. Review your joint finances

Your family’s credit score is not kept on your file, so long as you don’t have any joint finances. If you do, you’re likely to be co-scored and this could affect your chances of securing a mortgage. If a family member, partner or housemate has a poor credit score, keep your finances rigidly separate. This includes joint accounts and bills under both names.

5. Stay positive and improve your credit score

If you currently have a poor score or no credit history, you may still be able to qualify for a mortgage. And if you’re self-employed, some lenders will only require you to show one year’s set of accounts. To improve your score, consider taking out a credit card and using it regularly – remember to ensure you pay off the bill each month. You can also take out a mobile phone contract.

6. Manage your repayments

If you have an existing credit card or loan, it’s important you keep up with the minimum repayments and avoid getting too close to your credit limit. Missing or defaulting on payments, County Court Judgements (CCJs), payday loans, and clear betting patterns on your bank statements can all lower your chances of securing a mortgage. If the current climate means you’re struggling with repayments, speak to your lender about a payment holiday. This won’t affect your credit score.

7. Ensure you’re on the electoral roll

Demonstrating that you have a ‘stable’ lifestyle can improve your chances with lenders. This includes showing that you live at a fixed address and that you’re in full-time employment. If you haven’t already, you should register on the electoral roll as you’re unlikely to get credit without it. If possible, provide a landline rather than mobile phone number.

8. Be consistent and double check

Take your time when filling out and cross-checking your application form. Small mistakes such as mistyping your postcode or inconsistent information (even on application forms for other lenders) can flag up as possible fraud, which could then slow down or stop your application altogether. Be mindful of submitting numerous applications in a short space of time, as lenders may worry about why you’ve been rejected before.

9. Organise your paperwork

From bank and credit statements to payments, applying for a mortgage often requires you to provide a large amount of information. Why not use the extra time at home to get your paperwork in order? Our New Home Mortgage Advisers can talk through what you’ll need.

10. Keep saving

Lenders will pay attention to your saving habits, so try to save regular amounts that show you’re actively trying to build up a deposit. Of course, the current financial uncertainty may make this difficult at the moment. Take a look at government saving schemes like the Lifetime ISA, which gives you a 25% bonus on up to £4,000 each tax year.

Beginning your mortgage journey can be an exciting but overwhelming time. Our New Home Mortgage Advisers are always here to help with expert and fee-free advice.

Your home may be repossessed if you do not keep up repayments on your mortgage or any other loan secured on it.

*Research carried out by OnePoll on behalf of Barratt Homes, April 2015, among UK 2,000 adults.