Preparing for a Mortgage Application
- January 22, 2016
- Posted by: ms-adm32
- Category: Getting a Mortgage, Mortgages Ireland
Whether you are a First-time buyer (FTB) or looking to trade up, preparation is key to making a successful application for mortgage finance.
Mortgage Applicants cannot underestimate the importance of seeking advice and having their mortgage application packaged in a professional manner so as to facilitate underwriting by a lending institution. Financial Institutions are lending but only to applicants who show sustainable income from permanent employment and who also show evidence of repayment capacity in relation to their proposed mortgage commitment.
As a starting point, it is important for borrowers to understand the criteria on which mortgage approval is extended, in particular the Central Bank mortgage lending regulations introduced in January 2015. These measures introduced proportionate limits for loan to value (LTV) and loan to income (LTI) measurements for both primary dwelling houses and buy to let mortgages as follows:
- Maintain satisfactory current accounts:
Clear overdrafts and do not get into the habit of relying on an overdraft facility. As part of the mortgage application, most lenders require 6 months current account statements. - Saving:
Save consistently but do not over extend yourself by being unrealistic in relation to the monthly savings amounts you can afford – lenders do not like to see that you have to dip into your savings towards the end of the month. Even if you are getting a parental gift by way of deposit lenders still like to see that you have accumulated savings and show strong financial management..
- Employment Status:
If you are considering changing employment be mindful that you need to be in permanent employment before you can secure a mortgage and that any probationary periods must be completed prior to mortgage draw down (and in some cases prior to formal approval) - Independent Advice:
Get Independent advice from a professional broker who will guide you through the mortgage process – at Mortgage Horizons we offer a Free and Independent service to our client. Our experience is invaluable in securing mortgage approval.