Things are getting exciting now. You’ve found the perfect property. They’ve accepted your offer. It’s all systems go.
So what happens next? You speak to your adviser and get the ball rolling… that’s what!
What will my adviser do first of all?
Having ascertained what your plans are in the short, medium and perhaps even long term, your adviser will be in a good position to start moving you through the mortgage application process.
First off, that will mean gathering some initial supporting information from you. This will include:
- Last 3 months bank statements
- Last 3 months payslips
- Most recent P60
- Copy of your passport
- Copy of your driving licence
Their next step will be to sit down with you to complete a ‘fact find’. This will give both you and your adviser a useful picture of your circumstances. Now, be warned, this isn’t a five minute job. There are a lot of questions to go through, and it might feel as though your finances are being inspected under a microscope. However, putting in the detailed work now, will definitely pay off later when your mortgage application is submitted. Your adviser will have identified any weak areas and taken steps to mitigate them. And this will mean you’re hopefully one step closer to that all important – acceptance.
Search the market…
Having gathered a clear picture of your financial situation, an experienced adviser will already have a feel for which lender is best for you. However, they will still research the whole of the market before making their recommendation.
And once you’re happy with their recommendation… then it’s on to the next step.
Decision in Principle…
Your adviser will complete a Decision in Principle application for you. Once submitted, the chosen lender will complete their initial credit underwriting. Three possible decisions can come from this:
- Accept – which means your adviser can move on to complete a full mortgage application.
- Refer – which means that some initial data is outside of the lender’s normal lending criteria. However, your application may still be acceptable, it’s just that your case will be reviewed by an underwriter in more detail (which in turn will then lead to an accept or decline decision).
- Decline – which means you have been turned down for a mortgage in this instance. Your adviser will speak to the lender to understand why, and will explain the reasons to you. Depending on what the issue is, it might be that your adviser will then undertake to do another DiP with another lender.
If, once this process has been completed, you have been accepted in principle, your adviser will look to proceed to a full application.
Moving to full application…
At this point, your adviser will need to know which solicitor you will be using. They will also gather any further information that the lender has requested from the DiP.
When armed with everything they need, they will then:
- Complete the full mortgage application
- Request that you pay any lender fees (eg. application/valuation fees etc.)
- Forward all the supporting information requested by the lender
Things now start to get even more exciting because your lender will instruct a valuation to be carried out. This usually takes place within 10 working days of your application being submitted. If the valuation comes back and the lender is satisfied, they will review your file and hopefully issue their mortgage offer.
This will normally be sent out within 10 working days of receipt of the valuation. It will be sent to you, your adviser and your solicitor. And it is at this point that your solicitor’s work begins in earnest. They will carry out the necessary searches and liaise with you and the lender to arrange a completion date.
Is that it?
Not quite, though your adviser will possibly take a bit more of back seat at this point. The majority of their work has been done. There is little else that they can do with regard to the actual mortgage application besides push the solicitors and lenders along if things start to drag on.
However, a good adviser will be mindful of other financial aspects that you may need to consider. These could include protection requirements as well as general insurance (buildings and contents).
How long from start to finish?
The general rule of thumb is that an adviser will aim to have an offer being issued to you within 4 to 6 weeks of making the full mortgage application. From this point solicitors should be able to conclude the process within another 4 to 6 weeks.
Other articles in this series written for first time buyers…
- An introduction to getting a mortgage
- Do I need an adviser?
- How much can I borrow?
- What types of mortgage are there?
- How to boost your chances of getting a mortgage
- What is ‘Shared Ownership’? What is ‘Help to Buy’?