We recommend starting 7-months before completion. A mortgage offer is available for a maximum of 6-months (at the point of the offer made from your bank) but it's important to start earlier so you have time to shop around for the right advisors, lenders and rates.
Check out your options with the help of a mortgage adviser – if you don’t have one, we or your agent can put you in touch with a few independent advisers. They’ll help you find a lender (if you need it) and an ‘Agreement in Principle’ (AIP) of the figure you’d be able to get a mortgage for. They'll be able to talk you through various options and find the best available rate based on your financial situation. It's important to remember that although this takes a lot of the hard work away, it does come at a price so make sure to take their fee into account when applying.
Once you’ve found the ideal mortgage, you or your adviser will contact the chosen lender, who'll then reach out to us. This is not the actual full application but the first part where we tell a lender all about your property. With this information and satisfactory valuation, the lender essentially promises that they’ll accept your official mortgage application as long as the information you’ve given them is correct and can be validated.
Once the application submitted, the lender will ask you for various documents like payslips, bank statements etc. Lenders usually perform what is known as a "Stress Test" or “Affordability Assessment”. Essentially, they look at your net disposable income, for example your salary, to see if you can afford the monthly payments should interest rates rise – even if you’re on a fixed rate. This is in place to protect both you and the lender.
The lender will arrange for a surveyor to carry out a valuation of the property you want to buy to assess its value, as security for the mortgage. You will need to pay for the valuation when you submit the full application to the lender – not when securing a DIP.
Once you have passed the initial affordability checks and the lender has valued the property, your lender will send you a legally binding mortgage offer.
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