First of all you really do need to discuss your requirements and budget at an early stage with an Independent Mortgage Broker (I do mean INDEPENDENT and not one providing mortgages from a panel of lenders). Many of my clients get a shock when they are paying rent of £XXX per month and know this is paying the mortgage on the property then find out THEIR mortgage will cost them £XXX+YY (otherwise known as an arm and a leg!). This difference can be for a variety of reasons eg:
• Little or no deposit
• Impaired credit history
• Unable to prove income
• The landlord has owned the property for quite some time and the loan in relation to the property value is quite small and therefore a very good interest rate is available to him/her but not you.

Lets not forget other possible costs eg:
• Valuation fee
• Application fees that cannot be added to the loan
• High Loan to Value Insurance (this is for the benefit of the lender since it is taking more of a risk than normal and it will want to take out an insurance policy to protect itself in case you have to be repossessed – make no mistake here, YOU will still be liable for any shortfall, including costs, if the property is repossessed and sold. The insurance company will come knocking for the money they have paid. Some lenders start charging from as low as 70% loan to value. Some lenders allow this to be added to the loan, others do not. Another good reason to discuss your requirements with your broker:

• Solicitor fees and associated disbursements
• Broker fees – some clients will be charged a fee on top of the fee the lender will pay. This may be because of the amount of work involved in more complicated cases, or because the fee paid to the broker will not cover his or her costs: and lets face it, you don’t work for nothing…

The lender’s requirements – not unreasonably the lender wants to ensure that you fit its particular criteria – if you do NOT provide the requested documentation you will NOT get the loan, it is as simple as that. The full checklist is available on my website www.1st-affordable-mortgages.co.uk – you will not necessarily need all the items but if you are ready to provide what is required you will save not only an enormous amount of time but a significant amount of frustration and stress (for all):

• Proof of Identification - a passport or driving licence
• Proof of residency - a utility bill (mobile phone bill and TV licence are not normally acceptable)
• Bank Statements - the last 6 months (some lenders accept 3 months)
• Mortgage Statement(s) - the last 12 months (this and can be obtained from your lender)
• Chequebook (for the cost of the Valuation which accompanies the application)
• Landlord name(s) and address(es) - the last 3 years
• Details of any existing and previous mortgage(s) for the last 3 years
• Loans and credit card details (balance and monthly payments)
• Addresses you have lived at over the last 3 years
• Employment details (name, address, contact and telephone number) for the last 3 years
• New property address and contact details
• Estate agent address and contact details
• Your solicitor's contact details

Self-employed?

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