KIS Bridging Loans
Presented by KIS Finance

When you apply for a mortgage, lenders will do a thorough check of your credit history and they may also ask for your most recent bank statements.

They do this to get an understanding of your financial situation; so what your income looks like, your regular outgoings and financial commitments, and how you’ve borrowed money in the past.

There are several factors that can affect your ability to obtain a mortgage, so this guide goes through some of the easy steps that you can take to boost your chances.

1. Be very selective with other loan applications

Having hard credit searches on your credit file will temporarily bring your credit score down, which could have a negative impact on your mortgage eligibility and the rates you will be offered.

Having multiple hard searches for credit cards and loans may also give the impression that you’re desperate to obtain credit, which implies poor financial management. This could make the lender more inclined to deny your application due to uncertainty about your ability to meet repayments.

If it’s something that you 100% have to do, then one application shouldn’t make too much of a difference, depending on the type of credit whether it’s affordable. But things like payday loans should absolutely be avoided.

To give you the best chances, try to avoid any credit applications in the three to six months before you apply for a mortgage.

2. Check your credit report and amend mistakes

Checking your credit file and keeping an eye on your score about 6 – 12 months in advance of applying for a mortgage will ensure that it’s in the best shape before mortgage lenders take a look.

It’s important that you’ve done everything you can to easily boost your score, like ensuring you’re on the electoral roll for example, and you also need to check for any mistakes.

Make sure that there aren’t any credit applications showing that you didn’t make, and check that all of your credit limits and outstanding balances are accurate. If these are incorrect, it may look like you’re using a lot more of your available credit than you actually are, which may reflect poorly on your financial situation.

3. Pay off any outstanding balances you can

If you’ve got any credit card balances or loans, for example a sofa that you bought on finance a couple of years ago, that you can afford to pay off, then you should. Having fewer loans and facilities on your file will look better to a lender, and it will also bring your expected monthly outgoings down. This will make your mortgage repayments more affordable.

Paying off credit balances will also boost your credit score which may mean you get offered better mortgage rates.

4. Avoid changing jobs just before you apply

Lenders like to see that you have a secure and stable income stream, so they may not want to lend to someone who’s very recently changed jobs and is still in a probationary period.

Of course changing jobs throughout life is completely normal, but you should avoid it in the six months or so before applying for a mortgage. If you have no choice but to change jobs, then maybe hold off on your application for a few months until you are out of probation and settled in your new job.

Similarly, if you are currently employed but are thinking about going self-employed, then you should wait until after you’ve secured your mortgage. Lenders will need to see a few months’, if not a couple years’, worth of accounts and tax returns before they grant a mortgage.

5. Sever any old financial links

If you’ve had ex-partners with whom you’ve had financial links with, then you need to ensure that all accounts have been closed.

This could have been a join bank account, a credit card, or a loan account to which both of you had access. If you’re no longer with that person and they will not be party to the house purchase or mortgage, then you need to ensure that you’ve closed all accounts and cut all ties with them.

Once you have a joint facility with someone then this shows up on your credit file, and how they manage their finances will affect you. So if, for example, they regularly fail to make credit card payments then this could damage your credit score and therefore your chances of getting a mortgage.

Looking at your credit report will show if you have any financial links a person.  


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