Mortgages Explained Part 2 - TMP The Mortgage People

TAKING YOUR APPLICATION FURTHER

This bit's all about how assessments work. As well as everything you'll need to do, what we'll do for you...ooh and keep an eye out for a little bit about what you shouldn't do!

What happens next?: Once we have submitted your application your Client Account Manager will see you through your journey. Your application will go to the lender, who will complete all their checks and your case manager will keep you updated every step of the way. Once your mortgage offer is issued, this will be sent to both you and your solicitor.

At this point your solicitor will start the main bulk of their legal work. Once this has been completed, you should be able to set a completion date to move in and get your keys! Exciting!

Can I change job or take out credit now?: The quick answer is no, not without speaking to your adviser. But this is REALLY important to bear in mind. Any change to your circumstances or credit will impact your application. This doesn’t mean it’s impossible but please discuss your situation with your adviser to make sure you understand exactly how it will impact your application.

What fees will I have to pay?

You will be asked to pay a number of different fees in order to go ahead with your purchase. These could be:

Arrangement / valuation fees (where necessary) payable to your mortgage lender (your adviser will talk to you about these)
Broker fees
Solicitor’s fees
Reservation fees payable to your Housing Association / Builder

Please make sure you understand all these fees before you go ahead with your application. Ask your adviser if you need any further clarification.

How long can I expect it all to take?: While we can’t give you a specific answer here, as every case is different, we do understand how important it is to know roughly how long you’ll have to wait to move into your new home.

In normal times you can expect to exchange contracts within 28 days if you’re buying a new build property or between 4-8 weeks for a resale. But due to delays related to the Coronavirus pandemic, timeframes can vary.

Your case manager will keep you up-to-date with everything that’s going on with your application and you’ll be able to ask questions at any time.

What are insurances and why do I need them?: Insurance, also known as protection, is something you should put in place to ensure that no matter how your circumstances change you will still be able to cover your mortgage repayments or repay your lump sum amount. Remember, your lender has a right to repossess your property if you don’t keep up with these payments.

The exact type of protection you need to help you achieve this will depend on you and your family’s circumstances. Your mortgage adviser will be happy to talk to you about this.

ONCE WE'VE HIT SUBMIT

Want to know what the mortgage company will be looking at when it comes to the finer financial details? Read on!

What is underwriting?: Underwriting is something your lender will do when they process your application. It’s a way of the lender making sure they don’t miss anything, or take on too much risk. Some lenders have humans that underwrite for them, they are called underwriters, while some lenders use an automated process to underwrite. However they underwrite, the purpose is to make doubly sure the lender is willing to lend you the money you’ve asked for.

How does underwriting work?: During the assessment process your lender will use the information in the application we have submitted along with the documents they have asked for. You will have supplied us with payslips and bank statements, or if you are self-employed accounts dating back 2-3 years.

Lenders will also refer to the information that credit reference agencies hold on you, essentially your digital profile. This shows your payment history along with where you have lived and who you are linked to. If they find something that’s not been disclosed, it can cause delays, so always tell us everything right at the start.

The results of the valuation survey will also be taken into account, as well as any information about your lease. Essentially the lender is trying to make sure that you can afford the level of debt you will be taking on, that the monthly repayments are well within your means and that should interest rates rise and increase your payments, you will still be able to cover them in the future.

Why do I have to send in my payslips and bank statements?: Payslips and bank statements are the best way for your lender to see that the levels of outgoings you have put in your application are correct. Mortgage brokers and lenders have lots of due diligence checks they must complete to comply with the requirements of the FCA, the regulatory authority. They must be sure they are lending responsibly and making the right decisions.

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You may have to pay an early repayment charge to your existing lender if you remortgage.

Your home may be repossessed if you do not keep up repayments on your mortgage.

There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% of the amount borrowed but a typical fee is £500.