What to expect when getting a mortgage

A quick overview

This video walks you through the mortgage process, from saving your deposit to applying for your mortgage. It explains how lenders work out what you can afford and what happens after your offer is accepted. You'll also get an idea of how long the process can take.

Transcript

The first step to securing a mortgage offer is to get a deposit.

Most lenders offer first-time buyer mortgages up to 95% of the value of the home you want to buy.

That means you’ll need a deposit of 5%. 

So, what does that all mean?

Let’s imagine you want to buy a flat for £100,000. You need at least a 5% deposit - that’s £5,000. 

You’d need to borrow the other £95,000 from a mortgage provider.

That's your mortgage loan; which you would pay back, along with any interest, every month until your loan is fully repaid.

How does it work?

Once you have your deposit, you can contact a mortgage provider or broker to see how much you can borrow.

This called an affordability check. It’s based on things like your income and outgoings and will give you an idea of your budget and what properties you can afford. 

Lenders use the affordability check to do a soft credit check. If they’re happy with the results, they’ll offer you a decision in principle. That’s a document that shows a lender is willing to lend you a set amount of money. Estate agents may ask to see a decision in principle before you can make an offer on a property.

Once you’ve had an offer accepted, you’ll move on to the mortgage application stage. You’ll be given information on the types of mortgages available and what deals could work for you. 

You’ll probably be asked to provide some documents, like proof of how much you earn. This is so your lender can underwrite your mortgage – which basically means they formally check your finances including income and debt and the details of the home you want to buy.  

The lender will also do a valuation on the property you’re hoping to purchase, to make sure it’s worth the money they’re lending you to pay for it.

How long does it all take?

Getting a mortgage application accepted can take a few months; usually two or three. It all depends on the property you’re buying, the lender, and your personal circumstances

Good luck on your home buying journey and remember we are always here if you have any mortgage queries

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Understand more about applying for a mortgage and buying your first home.