Over the past year, the housing market has soared to incredible heights, and many people are investing in the property market like never before.
With average house prices across the UK reaching a third of a million pounds, people are looking to either invest in property or move house whilst government schemes are available to help facilitate these moves.
There are typically three main phases to the house buying process: finding the property and agreeing to a price, getting a mortgage agreement and conveyancing.
Here are some of the best ways to speed up mortgage process:
Start Early
The three steps largely overlap each other, and a buyer should be seeking out a mortgage broker in London as soon as they start looking for properties in London, as the time it can take means that a property can be taken off the market before a buyer has a chance to get it.
Starting the application process early and getting an Agreement in Principle (AIP) means that you have a budget in place, sellers know you are ready to buy and it gives you a window to negotiate.
Get An Agreement In Principle
An AIP is typically simple to get as you do not need the whole application process to be completed.
Generally, you need some identifying information, your recent address history, your credit history, credit score and current income and expenditure.
Mortgage brokers will then use this to decide how much they will give you, and you know the upper limit of your budget that way.
Get Documents Ready
Mortgage applications require information and documents to support this information, so make sure that you have this information to hand to give your lender along with your application form.
This documentation will prove you have the three canons of credit:
- Capacity to pay,
- Collateral in case you do not,
- Character proof that you have a history of paying back debt promptly.
This information can include your household income and expenditure, bank assets, credit rating, any relevant credit history issues and your tax information.
If you are self-employed, this will involve providing a few years of tax returns, but in other cases, a recent payslip will be enough to get the information they need.
As well as this, they will need information on how you will pay your deposit, particularly if you are receiving a cash gift to help with this.
Have these documents and double-check they are exactly what the lender requires. Underwriting often requires precise information so ensuring a lender has what they need the first time of asking will speed up the process considerably.
Avoid Significant Changes
Mortgage approval comes in two stages; underwriting (or pre-approval), and appraisal. The first stage is the application process and is usually either approved (often with the condition to provide more information) or denied.
After this stage comes the appraisal stage, which involves appraising the value of the property you plan to buy to ensure you are not asking for more money than the market value of your property, as well as adding income, credit, assets, employment status and any other relevant information.
During this time major changes can delay, or in some cases restart the appraisal process, such as changing jobs, buying expensive assets, applying for credit, missing payments or depositing large sums of money into a bank account.
Let a lender know before you plan on making a major material change.
