Mortgage process - what happens?

[wetwashinginthewind]

I know the basics but how does the whole process work?

Is all I need to get house hunting a decision in principle? Once I've found somewhere what happens next? What kind of paperwork do we need to provide - payslips, bank statements. What about debt - I know you declare any debt but what proof do they want/need? And then does the solicitor take over? Do any fees go into the mortgage or are they paid seperately?

We're thinking of using a broker - is that the best way to do it?

How much should we set aside for fees both mortgage fees and solicitor fees etc?

I'm after an idiots guide! I feel a bit silly asking people in real life

Thank you

You need an agreement in principle first. Do you have an idea of what value properties you can look at? You'll need to pay stamp duty, which can't be added to the mortgage. Rates changed last month.

I would go through a broker. It's hard to say how much your fees will be without knowing the value of the houses you are looking at. Mortgage fees can usually be added to the mortgage.

Call London & country. Fee free and whole of market available to intermediaries. Great service

Don't do lots of internet comparisons where you have to give your details, as too many credit applications will count against you - apparently!

I don't know much either but you can download the money saving expert guide and that's helped a bit.

Hi OP

I'm a financial adviser and whole of market mortgage adviser.

The best advice I can give you is to find a good whole of market adviser in your area and they will talk you through the process and do most of the work for you. I would do this before I go house hunting so I could have a really good idea about what I could borrow and also any hurdles I may come up against.

When you have had an offer accepted your adviser will apply for a decision/agreement in principle specific to that property and if all is well submit a full application.

Every lender has different requirements so it's difficult to say what exactly you'll need but as a guide you will need proof of income (payslips, sometimes P60s, tax returns/accounts for the self employed/directors), probably three months bank statements minimum and it is advisable to prepare a list of your monthly outgoings for the adviser before you meet as you will require this for any application. This list should obviously should include any debts. A credit search will verify these debts.

In terms of fees...if you go for an adviser there is a good chance they will charge you a fee at outset but in my experience this will save you in the long term and give you access to the whole of the market. Product fees charged by a lender can usually be added to the mortgage. Some lenders charge an application fee which will be non-refundable but most don't. Again, an adviser will factor in all of these fees when determining the overall cost.

Solicitors fees will vary...depends on the value of your property and whether you are selling and purchasing, or just purchasing. They also vary geographically, again your adviser will be able to give you a better idea than I can.

Stamp duty will depend on the value of the property you purchase.

Once you have had your application accepted then everything is put in the hands of your solicitor to complete the process.

in terms of choosing an adviser, I would suggest you ask for personal recommendations locally and do make sure they're whole of market and aren't tied to any particular lender/s.

Sorry I can't give you any actual figures but without knowing your personal circumstances it would literally be impossible to say.

Good luck and happy house hunting!

Thank you

We're hoping to borrow about £150,000 on DH salary only. He has about £10,000 on a credit card, interest free. This is about half of all credit available to him, and we have checked credit rating and it shows as excellent. Just worried they won't think we can afford payments. Payments will be less than our rent though and we have a plan

We have a small deposit, probably about 7.5%.

So your deposit is about £12k and your credit card debt is about £10k?

Some lenders really really won't like that. (I've been knee deep in underwriting policies lately). Definitely use a broker.

Why on DH's salary alone? Do you work? How much does DH earn?

We're first time buyers and going through the process right now. I totally have not been awake since 3am on rightmove.

People seem to love to help (and by gum, I've been asking everyone) and give advice which we're massively grateful for. Colleague I trust a lot gave me her financial advisir's details and he came round and talked us through whole process. He is great and answers all our questions, however trivial almost instantly.

Money saving expert has a lot of info, including a first time buyers guide which was great, explanations really clear and not confusing.

I would advise reading as much as you can about mortgages, talking to EVERYONE you can about it, and calling London and County (money saving expert work with then).

Good luck!! I am finding the whole thing massively exciting and can't wait to have our own front door.