The mortgage process is relatively swift these days, but only if you have already spent some time getting together all the information you need.

An Application In Principal (AIP) is less time consuming than for the formal mortgage application which goes into a great amount of detail and you will be expected to provide a lot of information including personal information of all members of your household, details of your job and previous jobs, your current and former addresses, dates of birth, employer’s details, bank details and much more.

At Mortgage Required we can help you establish what information you will need so that you can start to collate information. For example, most mortgage lenders will want to see 3 - 6 months of bank statements and possibly statements for credit cards and savings accounts.

You will need to prove your income is what you say it is and provide a breakdown of your household budget so that the lender can ascertain that you are able to afford to repay your mortgage every month.

As an employee this is fairly straightforward, although you may need to get your P45 wage slips and P60 information together now. If you are applying for a self employed mortgage you need to prove your income and this might mean getting management accounts made up to date and signed off by your accountant or auditors. Alternatively, you can apply to the taxman to obtain a notice from him in respect of your income for the previous year. This is called an SA302 and can take some time to obtain.

At Mortgage Required we guide you through this process, making it fairly painless! Once the application is complete it can be forwarded (together with any supporting evidence that may have been requested) and we wait.

Most applications for an AIP (Agreement in Principle) should not take more than 24 - 48 hours - once the application is complete. With an AIP you are in a great position to make offers and once you have an offer accepted you will need to formalise the mortgage process and obtain a formal mortgage offer. This will then mean you (or we) need to submit a full application with supporting information. Mortgage Required will also guide you through this process.

An application form might take between an hour and two hours to complete and then a variety of other checks will need to be undertaken by your solicitor and by a valuation surveyor who needs to inspect the property and determine that it is worth enough to support the terms of the lender’s mortgage offer. We will work with your lender, the valuer and your solicitor / conveyancer so as to smooth the process, with most formal mortgage offers being received within 20 - 40 days of formal commencement.

This offer, and your acceptance of this offer, is legally binding and so it is important that your legal representative deals with this matter on your behalf. It is not unusual for the same person to act on behalf of the lender to (with your permission) and this will usually help to keep costs down and speed the process.

Once you have a formal offer in place, the legal work has been done for the conveyance and your solicitor is ‘in funds’ (i.e. he has your deposit, etc) then you should be in a position to exchange contracts to buy the property!

Most house purchases take between 6 - 8 weeks from accepted offer to exchange of contracts with final completion at a determined date soon after - if everything goes smoothly. A good proportion of this time may be taken by the mortgage process. The good news is that whilst this is being done the conveyancing work and searches, etc can also be undertaken, meaning that once you have your mortgage offer you should be pretty much ready to go.

Of course, if you have not previously obtained an AIP from a mortgage lender you are very much dependent on this formal offer arriving and with no AIP you have no idea whether your lender will make you a formal mortgage offer. You may decide that instructing a valuer and conveyancing lawyer without an AIP is too big a risk. After all, if you subsequently find out your lender won’t lend to you (or lend you enough) you might have several bills to pay for work done on your behalf. This is why we usually recommend that our clients obtain an AIP relatively early in the process.

For more information on the mortgage application process contact us on 01628 507477.

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