Applying for a mortgage – what you need to know

Buying a home is exciting, but the mortgage application process can feel a bit overwhelming. We understand and we can walk you through the steps and make sense of the whole process for you, all the time communicating in plain English without jargon.

Whether you’re a first-time buyer, a homeowner looking to remortgage, or a property investor, this blog will help you feel more confident and prepared for the journey.

What to Expect

When you start thinking about buying a property, a mortgage application is one of the first things to consider; especially as this will give you a clear indication of what you can spend. In the UK, the process for applying for a mortgage involves a number of steps. Let’s break them down here:

1. Assess your finances: Understand your income, your household and other expenses and your credit score.

2. Get a mortgage agreement in principle (AIP): Based on your finances and income / expenditure, an AIP tells you what you can borrow and shows sellers and estate agents that you’re a serious buyer.

3. Find a property: The fun bit… searching online is a good start, but work with estate agents too as often properties can sell before they reach the sales platforms.

4. Make an offer: When you find your dream house, it’s time to negotiate with the seller – this can take time and multiple counter offers, but keep your budget in mind and don’t get carried away.

5. Apply for a mortgage: Once the price is agreed, you need to submit your full application with supporting documents.

6. Mortgage offer: Assuming everything is in order and the lender is happy with both the property valuation and your finances, they will then confirm your mortgage offer.

7. Conveyancing: This is the legal work to transfer ownership and involves searches and valuations as well as confirming what fixtures and fittings will be included in the sale.

8. Exchange of contracts: Usually a week or two before completion, the contracts are signed and exchanged. After this point, pulling out of the purchase could forfeit your deposit.

9. Completion: The final stage, and the day you get the keys to your new house.

Each step has its own peculiarities and requirements, but knowing the flow and what happens next helps you to stay on track.

Typical UK residential street with terraced houses

Proper preparation: what you need to know

Before you start the formal application, preparation is key. Here are some practical tips to get ready:

• Check your credit report: Make sure there are no surprises in store.

• Save for a deposit: Most lenders require at least 5-10% of the property price, but the more you save, the lower your payments will be.

• Get the paperwork ready: Payslips, bank statements, ID, and proof of address will all be needed to complete the mortgage application, so make sure you have everything you need.

• Calculate your budget: The AIP is one thing, but before you get this, there are loads of online calculators that give you an idea of what you might be able to borrow and what it will cost.

• Consider additional costs: Stamp duty, solicitor fees, surveys, and moving costs all add up. And do you need to budget extra for redecoration?

Being organised from the start saves time and stress later. It also shows lenders you’re responsible, ready and understand what they will need.

Documents needed for mortgage application

Approval timeframes

One of the most common questions we’re asked is: How long will it take to get our mortgage approved? In truth, there are a lot of variables, here’s a general timeline:

• Mortgage agreement in principle: Usually within 24-48 hours.

• Full mortgage application: Can take two to six weeks.

• Mortgage offer: Issued after the lender completes checks and valuations.

Factors that affect timing include:

• How quickly you provide documents.

• The lender’s workload.

• Property valuation scheduling.

• Any complications with your financial history.

To speed things up, respond promptly to requests and keep your paperwork organised. Remember, patience is important, but staying proactive helps.

Mortgage application form and calculator on desk

Top tips to keep things moving

Navigating the mortgage application process can feel daunting, but these tips will help you stay on track:

• Use a mortgage broker: They can find the best deals and guide you through the paperwork needs. They also deal with communications with the lenders.

• Be honest and thorough: Provide accurate information to avoid delays.

• Keep communication open: Stay in touch with your lender and solicitor and respond to questions quickly and honestly.

• Plan for unexpected costs: Have a financial buffer for surprises – there will always be something.

By following these steps, you’ll reduce stress and increase your chances of a successful mortgage application.

After approval

Once your mortgage is approved, the process moves towards completion. Here’s what to expect next:

• Mortgage offer received: Review the terms carefully and ensure you’re happy with the repayments and any fees you may have to pay.

• Conveyancing progresses: Your solicitor will handle legal checks and contracts.

• Exchange contracts: You and the seller commit to the sale.

• Completion day: Funds are transferred and you get the keys.

• Move in and enjoy: Time to settle into your new home.

It’s a good idea to keep in touch with your solicitor and mortgage broker through each phase - they’ll keep you updated and help with any last-minute questions.

Making your homeownership dreams a reality

Buying a home is a big step, but understanding the process makes it much more manageable. We hope this guide has helped to explain the process and make the application process less intimidating. Remember, preparation and good advice are your best friends.

If you’re ready to start your journey or want personalised support, Bay Mortgages is here to help. We specialise in helping local buyers in Poole, Bournemouth and beyond find the right mortgage with confidence.

Let’s make your homeownership dreams come true - one step at a time.