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FREQUENTLY ASKED QUESTIONS

Please be advised that this is a guidance only and a mortgage offer is not guaranteed until full underwriting is assessed by a lender which includes (but not limited to) your credit history, residency status, income and employment, deposit, type of mortgage, property type and location, etc.

 

It’s important to note that each lender has its own specific eligibility criteria, and some may be more flexible than others. Prospective mortgage applicants should check with individual lenders or mortgage brokers to determine the specific requirements and options available based on your specific circumstance.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Foreign Nationals

Can I get a mortgage in the UK if I don't hold Indefinite Leave to Remain (ILR)?

The short answer is YES. Depending on the length of time you arrived in the UK, credit score and other criteria. There are lenders that would consider applicants who hold Tier 2, dependent or spouse visa.

YES. There are lenders that are happy with these types of applications. This would even fall under their standard lending policy. Not all lenders accept this so best to speak to a mortgage advisor or check this with your bank.

It depends on your visa status and how long you have been living in the UK. If you have permanent rights to reside (ILR), you may be eligible for 0-5% deposit. Non-ILR holders can potentially be accepted with a 10% deposit. As part of the EU Settlement Scheme EEA, EU and Swiss citizens may either hold settled or pre-settled status in the UK. Most lenders would treat this under their standard lending criteria.

Anything outside of the above, most lenders would require at least 25% deposit.

YES. There are lenders taking deposits where the source is coming from outside the UK. Anti Money Laundering checks needs to be done so the origin of funds needs to be obtained. If funds originated from countries under the sanction list, this may not be accepted.

Some tips to help boost your credit score:

  • open accounts such as current accounts, credit cards, etc.
  • set up mobile contract
  • keep your address up to date
  • get on electoral roll when eligible
  • And most importantly, make sure to pay your dues on time!!

General First Time Buyer

What are the steps in applying for a mortgage in the UK?
  • Speak to a Mortgage Broker, or your bank for affordability assessment
  • Search for your dream home based on your affordability and deposit
  • Apply for a mortgage. Full underwriting done by the lender, this involves income and property assessment.
  • Legal checks done by solicitor once formal mortgage offer issued by the lender
  • Contract signing (completion) and move in!

Some of the cost are detailed below, but not limited to:

  • Deposit
  • Mortgage Broker/Advice fee
  • Stamp Duty
  • Solicitor and other legal fees
  • Lender’s Valuation Fee
  • Lender’s Product Fee
  • Insurances

Some fees may not be applicable to your purchase. Your mortgage broker, bank or solicitor should disclose all fees.

AIP, DIP or IPA – they all mean the same thing. This comes in the form of a letter or a certificate from your bank or mortgage broker which indicates how much a bank may be willing to lend you based on initial assessment of your income and credit score. It’s not a guarantee of a mortgage offer, but it gives you an idea of what you could potentially borrow, helping you understand your budget when house hunting.

This depends on several factors such as lender’s criteria, type of mortgage you are applying for, your residency status, credit history, type of house you are buying, schemes involved and your overall financial situation. However, a common guideline is that most lenders require a deposit of at least 5% to 25% of the property’s purchase price. Some mortgage schemes won’t require a deposit at all!

Adverse Credit History refers to instances such as missed payments, defaults, County Court Judgments (CCJs), Debt Management Program (DMP), Individual Voluntary Arrangements (IVAs), or bankruptcy. Having this in your credit file or history will not be a straightforward process and would be challenging, however getting approved for a mortgage is still possible.

There are still lenders who will accept the application. Factors such as how recently the adverse took place, the amount, whether satisfied or not, and how well have you maintained a good credit conduct with your current creditors and accounts will be taken into consideration.

Most lenders would take sole and joint applications where both incomes could be taken into affordability calculation. In certain circumstances, some lenders could take up to 4, or even up to 6 applicants!

Existing Home Owners

My current fixed rate mortgage is due to end, when would be the best time to review?
The best time to look at options is 6 months before your current deal expires. This will give you time to shop around for good deals between lenders that will meet your current circumstance and align to your future plans if this has changed when you initially took the current interest type for your mortgage.

It is always good to look at options what other mortgage providers can offer. You don’t have to stick to your current lender as other lenders may offer more competitive deals that would save you a lot of money in mortgage repayments!

Remortgaging will incur lesser cost than when you initially took the mortgage. Remortgaging may include the following fees:
  • Product fees – this goes with the interest rate, this could be added to your mortgage.
  • Valuation fees – a new property valuation may be required.
  • Legal fees – legal work may be involved depending on the change you would like to make.
  • ERC (Early Repayment Charge) – ERCs are charged if you’re remortgaging before the end of your current mortgage deal. If you are over your initial rate period, then ERCs are not applicable.
  • Broker fees –  If you use a mortgage broker to help you find a new mortgage deal, they may charge a fee for their services. This should be disclosed upfront.
  • Other Exit Fees – When you repay your existing mortgage, administrative costs associated with closing the mortgage account may be chargeable.
Some lenders would offer products that have cashback which you may use to cover the fees above, or some lenders may cover the valuation fee and legal fees as part of their incentive package too! 
Depending on how much equity you have in your current home, and if the additional borrowing meets your affordability and the rest of the lender’s criteria – you can certainly draw funds to buy another house, pay off existing debts, do home improvements, or even fund your next holiday!
Yes. Marriage or a new partner, separation or divorce may be one of the reasons why removing or adding a name to your current mortgage is the next best move. Mortgage underwriting will be based on the updated names to the new mortgage. There may be tax implications and legal considerations involved in transferring equity or making changes to your mortgage.