Preparing For A Mortgage
Censeo Financial provides mortgage advice to customers purchasing through affordable home ownership schemes.
Understanding what lenders may require at an early stage can help you prepare for the mortgage application process.
Affordable home ownership schemes such as Shared Ownership, First Homes, Right to Buy and Right to Acquire may have additional affordability and eligibility requirements set by housing providers and lenders.
The Mortgage Process
There are typically three key stages when applying for a mortgage for an affordable home ownership property.
1. Affordability Assessment
If you are progressing with a property purchase, the housing provider may require an affordability assessment to be completed by an approved mortgage adviser.
This assessment will consider your income, expenditure and financial commitments to help determine whether the purchase may be affordable based on your individual circumstances.
An adviser may also review lender criteria to identify mortgage lenders who may be appropriate for your circumstances.
2. Agreement in Principle (AIP)
Once you have been offered a property, a more detailed financial assessment may be required.
An Agreement in Principle (AIP) is an indication from a lender of how much they may be willing to lend, subject to full underwriting.
As part of this process, a lender may carry out a credit search. Any lending decision is subject to a full mortgage application and supporting documentation.
3. Mortgage Application
Following a full assessment, an adviser can provide mortgage advice based on your individual needs and circumstances.
If you choose to proceed, a mortgage application will be submitted to a lender for underwriting.
The lender may request further information during the assessment process and will normally instruct a valuation of the property for mortgage purposes.
If the application is approved, the lender will issue a formal mortgage offer. This may include conditions which must be satisfied before completion.
Your solicitor will then work with the lender and housing provider to complete the legal process.
Documents You May Need
To support a mortgage application, lenders may request documentation such as:
- Recent payslips or proof of income
- Bank statements
- Identification (for example, a valid passport or driving licence)
- Proof of address
- Details of any loans, credit cards or other financial commitments
- Evidence of savings or deposit
- Information relating to any gifted deposit
- Proof of benefits received (if applicable)
Self-employed applicants may also be asked to provide:
- SA302s and Tax Year Overviews
- or certified accounts from a qualified accountant
Additional documentation may be required depending on your individual circumstances and the lender’s criteria.
All information provided will be assessed by the lender as part of the mortgage underwriting process.