How long does a mortgage application take?

IF you are looking to buy a new home or remortgage you might be wondering how long your mortgage application will take.

It can vary depending on a number of factors but we have pulled together everything you need to know.

Getting approved for a home loan can be a challenge, especially at the moment since mortgage rates are going through the roof.

Usually people apply for a mortgage over 25 years – the time it takes to pay it off.

You can choose a longer term though – it's becoming more normal for people to take up to 35 or even 45 years to pay off their mortgage.

Choosing a longer term will bring your monthly repayments down but will mean you also pay more interest over the course of the mortgage.

Usually, a mortgage application takes two to six weeks to be approved.

But of course, every situation is different and could depend on a few key factors.

This includes the lender you apply to, what information they've asked you for, and how complex your situation is.

The process can be accelerated if you use a mortgage broker who will be able to find you the best deals.

Usually, the application process happens in these steps:

Contact your lender or mortgage broker who will help you find a deal
Make the application
Wait for the lender to give you a decision in principle
Begin the paperwork with your solicitor
Your lender will instruct a mortgage valuation on the property you want to buy
Once they are happy with your finances and the property details, they approve your application
Then your solicitor can authorise the completion of your home purchase after all the legal points have been resolved

What documents do I need to apply for a mortgage?

You will need to make sure you have all the right documents in order before applying for a mortgage, and there are a lot of them.

The three main categories are proof of ID, proof of income and proof of expenses.

Lenders will also look at your credit score before they decide to lend to you, so it's important that you've got a good score before you apply.

Here is a list of documentation that you will need to have ready, but bear in mind different lenders may ask for different things.

Current photo passport or driver's licence
Most recent utility bill (gas/electric etc)
Bank statement or credit card bill
Payslips
Self-assessment tax return forms (if self-employed) or accounts signed off by a registered accountant if you are VAT registered
Credit check report
Evidence of where your deposit is coming from – such as a savings account or a letter confirming you are receiving a deposit gift or inheritance

How to apply for a mortgage

You'll need to save a deposit before you can get a mortgage.

The average for first-time buyers is £50,000, although in many parts of the country you can buy with a much smaller deposit.

For example, to buy a property for £100,000, you could get a mortgage with a £10,000 deposit, providing you can afford the repayments.

When you have found the house you want you can apply for a mortgage.

What kind of mortgage you can afford will depend on your financial situation.

This will depend on factors such as your earnings, how much you spend a month and the deposit you are putting down.

Luckily, there are many online calculators are available to help you estimate what mortgage you can afford.

Check out price comparison sites such as MoneySuperMarket, Compare the Market, Confused.com or others.

Most people get advice from a mortgage broker.

Brokers work for you and by law they must recommend the most suitable mortgage for you given your specific circumstances.

Advisers who work for banks and building societies may be able to help you choose the best deal from their own range of mortgages.

In some cases, they will only be able to provide you with information and you will have to decide for yourself which deal you want.

If you do choose to use an independent broker, you may be able to get better deals than ones offered directly by the lender.

And if your mortgage turned out to be unaffordable then you can complain to the firm and the Financial Services Ombudsman and could receive compensation.

Some brokers provide mortgage advice for free and earn a commission from the lender – usually around 0.35% of the size of your loan.

If you took a £100,000 mortgage, this means they would earn £350 in commission from the lender.

Some brokers charge an advice fee on top, which can be anything between £100 and £500.

It doesn't matter whether you go for a broker charging a fee or not – you will get the best advice to suit your circumstances.

It's up to you – speak to a few brokers and mortgage advisers and choose someone you like.

Make sure that they are registered on the Financial Conduct Authority's list of regulated firms – you can visit their website to search.

Once a formal mortgage offer has been made it is usually valid for six months.

If you haven't completed your home purchase by then, either you can apply for an extension from your lender or you may have to reapply for a new rate.

You should expect to receive your first mortgage payment notification within five to seven working days of completion.

There are a number of ways you can boost your chances of being accepted for a mortgage.

How long does a mortgage application take? | The Sun

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