Over three-quarters of first-time buyer mortgage applications were approved last quarter. But how can you make sure you’re one of the success stories when applying for your first home loan?
In the first quarter of 2018, 76% of first-time buyers who applied through a broker or intermediary were offered a mortgage, figures from the Intermediary Mortgage Lenders Association show. By contrast, two years prior, just 48% of first-time buyers were approved.
To some extent, getting approved for a mortgage is up to the lender – but there are steps you can take to improve your odds.
Below, we round up the top tips for ensuring your first home purchase goes smoothly.
- If you’re planning to buy a new home, you can get expert, impartial advice by calling Which? Mortgage Advisers on 0800 2942 849.
1. Understand how much you can afford
Before you even start house-hunting, it’s important to work out how much you can realistically afford – there’s no point making an application that the lender is just going to reject.
The higher the deposit you put down, the less you need to borrow, and you could unlock better interest rates by buying at a lower loan-to-value ratio. So it’s worth gathering as big a deposit as possible.
The lender will also consider whether you can afford to meet your mortgage repayments, taking into account your current income and expenses. As a general rule, you can borrow four-and-a-half times your income.