It is now easier than ever to get a mortgage in principle online with many of the UK’s leading banks and building societies now offering a quick online decision. We explore why you need to do your research before deciding on which lender to approach for a mortgage decision.
Which lender do I choose?
When you search online for a mortgage in principle you will be presented with various results for UK banks and building societies offering an instant decision online.
How do you decide which lender is best? Is it the interest rate or maybe you bank with that lender?
We highly recommend speaking to an independent mortgage advisor before you approach any lender, even your own bank. The reason for this is that each lender will have different criteria on what types of property they accept and they could say yes or no depending on how long you have been in your job, your credit score or if the property is a house or a flat.
There are literally pages and pages of criteria small print for each lender based around you as an applicant, the property type and other factors.
We carried out a word count on a popular UK mortgage lender at random and their lending criteria policy, the word count came back at a stunning 8,114 words defining their lending criteria. That’s just one lender. So hopefully you can see how complex a mortgage lending assessment can be and why it is best to use a mortgage advisor.
Existing banking relationship?
Even if you have been with your own bank for 20 years+, this does not mean that you will automatically be accepted. This is where a mortgage advisor can come in, pinpoint the best lender and process your mortgage in principle online and wade through all of the complex criteria.
Be careful with Credit Checks
Another reason to use an independent mortgage advisor is that they can find the best option without approaching a lender for a credit check.
It’s tempting to quickly click a few buttons online to get a decision, but every time you do you could be affecting your credit score. When a mortgage in principle decision is made, the lender will check your credit file. This will leave a mark with some lenders and may even reduce your credit score.
What documents do I need?
Typically, you would need to upload a scan of your passport or driving license and proof of address (latest bank statement or utility bill) along with your latest payslip or self-employed accounts/returns as a minimum requirement.
Author: Ben, Glow Mortgage Advisor (CeMAP, BSc Hons)
Date Published: 9th March 2018.