How and when to apply for a mortgage when buying

How and when to apply for a mortgage is an important question when you are buying a home. Whether you are a first time buyer or a more seasoned house purchaser, getting it right with your mortgage is crucial to a smooth transaction. Getting it wrong can lead to delays and could even lead to your losing your purchase.

When should I start applying for a mortgage?

Our best advice would be to start the process of applying for a mortgage as soon as you can – ideally, even before you even start seriously looking for a property. Although it may seem counter-intuitive to start a mortgage application before you have identified a property, there are good reasons for this advice:

• Firstly, you need to find out how much you can afford to pay for a house. This is even more important if your financial position is less straightforward – if you are self employed for example or a Company Director. You don’t want to end up in a position where you have set your heart on a property and then realise that it is actually more than you can afford to pay.
• If you have your finance arranged in principle prior to starting the process of buying a house, it will simplify the process and hopefully, minimise delays through the process. According to a 2018 study by house selling resource website, TheAdvisory, the average transaction time from an offer being accepted to completion is around 11 weeks. This would likely be longer if a buyer had not already secured finance in principle at the point of offer. Arranging finance in advance also means that your purchase is less likely to be derailed by mortgage issues.
• Having a confirmed offer in principle can put you in a stronger negotiating position with a seller. If you have all your ducks in a row at the point of making an offer you will be viewed as a more desirable buyer than someone who has not.

Where to start?

Before you begin the process of applying for a mortgage, it is worth doing some initial research into the different types of mortgage available and the indicative costs. Getting advice from an independent expert such as the Mortgage Advice Bureau is a great place to start. The Mortgage Advice Bureau is one of the UK’s leading providers of expert, face-to-face, financial and mortgage advice on the high-street. They have access to over 12,000 mortgage products from more than 90 lenders. Visit our Mortgages Page for more information or to make an appointment.

Of course, you cannot get a formal mortgage offer until you have found a property to buy, not least because your lender will need to arrange to value the property and perform more in-depth investigations into affordability and verify the financial information you have provided in order to get an in principle agreement. Assuming though, that you have provided accurate financial information, (don’t be tempted to over state this as it will be subject to verification), an in principle decision will be good enough to enable you to proceed towards finding your ideal property with the confidence of knowing what you can afford to borrow. Pop in to see us at your local branch of Seddons’ or visit our website for more further information on the buying process and to register your details as a buyer.