Ready to get on the property ladder but unsure how long it will take? Discover more as we simplify the mortgage application process and share our top tips to boost your chances of approval.
The mortgage applications process can be long, and can involve lots of paperwork, credit checks, and complex terms and conditions. When applying for a mortgage application, lenders will assess your chances of approval by looking at your income, outgoings, and credit history.
Simply securing a mortgage can feel overwhelming, especially when it comes to choosing between interest rates and options. Fortunately, proper planning and advice can ease the process while a mortgage broker can help you find the best rates.
But don’t fret. We’re going to make it easy for you with our simple step-by-step guide. Ready? Your mortgage application process starts here.
How long does a mortgage application take?
The process of going through an entire mortgage application will typically take at least two months, though this timeline can vary depending on your individual situation. While you can get a mortgage offer in two to four weeks, there are additional factors that will influence the overall mortgage application timeline. These will include, but aren’t limited to, your financial situation, how quickly you provide the paperwork, and the lender's own processing times.
Before applying, many people choose to get a mortgage in principle. It’s an offer from a lender giving you an indication of how much you’re entitled to borrow. It’s based on a basic assessment of your financial situation.
While a mortgage in principle isn’t a full mortgage approval, it can be obtained quickly. It shows sellers and estate agents that you're serious and financially prepared to make an offer. The full mortgage approval comes after the lender completes their detailed checks on your application and agrees to loan you the money to buy a property.
The mortgage application process
Here’s a simple step-by-step guide on the mortgage application process itself:
Apply for a mortgage in principle
The first step in the mortgage process is getting a mortgage in principle (MIP), also known as a decision, or agreement in principle (DIP/AIP). This is a preliminary agreement from a lender that indicates how much they’re willing to lend you based on your financial situation. To secure a MIP, you typically provide information regarding your income, expenses, and credit history.
This step can be crucial as it gives you an idea of your budget and shows to sellers that you’re a serious buyer. Having a MIP can enhance your negotiating position when you make an offer on a property, as it assures sellers that you are financially capable of buying it. Sometimes it only takes a matter of minutes to get one after filling an online form.
Find a property and make an offer
Once you’ve secured your mortgage in principle, the next step is to start searching for a property that fits your needs and budget. This can involve browsing online listings, visiting open houses, and contacting estate agents. When you find a property you’re interested in, the next step is to make an offer.
This is typically done through the estate agent representing the seller. It’s essential to be strategic about your offer, consider recent sales of similar properties in the area to gauge a fair price. You may find yourself in negotiations, so be prepared for a back-and-forth discussion until both parties agree on a price.
Apply for a mortgage
With your offer accepted, you can now proceed to apply for a mortgage. This process involves submitting an official application to your chosen lender. Some of these include detailed financial information and supporting documents such as pay slips, bank statements, and proof of identity. The lender will conduct thorough checks, including credit checks, to assess your financial health and ensure you can afford the mortgage repayments.
During this stage, it's also a good idea to shop around for the best mortgage rates and terms, as different lenders may offer various products that could be more suitable for your financial situation. Mortgage brokers have a detailed knowledge of the market and are specialists at finding the best deals.
Conveyancing
Conveyancing is the legal procedure that transfers the ownership of a property from the seller to the buyer. This involves hiring a solicitor or licensed conveyancer who will manage all legal aspects of the transaction. Their responsibilities include reviewing contracts, conducting local searches, and ensuring there aren’t legal issues with the property that could affect your ownership.
The conveyancer will also liaise with the mortgage lender to ensure that all necessary paperwork is in order. It’s vital to choose a reputable conveyancer, as their expertise can significantly impact the efficiency and success of the property transaction.
Property survey
Before finalising your purchase, it's essential to arrange for a property survey. This assessment evaluates the property's condition and helps identify any potential issues that could affect its value or your decision to proceed with the purchase. For example, if Japanese knotweed is found growing on the property, the value of the home will be reduced.
There are several types of surveys available, ranging from basic valuations to comprehensive building surveys that offer detailed insights into the property's structural integrity. If the survey uncovers significant problems, you may want to negotiate repairs with the seller or reconsider your purchase altogether.
Contract exchange
The final step in the mortgage application process is the contract exchange. This is when both you and the seller sign the contracts, making the agreement legally binding. At this stage, you typically pay a deposit, which is usually around 10% of the purchase price.
Once the contracts are exchanged, the completion date is set, and neither party can back out without incurring penalties. This is an exciting moment in the home-buying journey, as it signifies that you’re one step closer to becoming a homeowner.
How long does a mortgage offer last?
A mortgage offer usually lasts between three and six months, although this can vary depending on the lender. This is the time you’re given to complete the purchase with that offer. If you’re not able to, you may need to apply for an extension or start again.
Some lenders are flexible and may extend the offer, others could want to start the process again. And different lenders use different starting points. Some accept the date you made the offer, others use your mortgage application date. Either way, it’s good to check what they’re okay with.
How long does it take to get mortgage funds?
The typical application timeline to get mortgage funds can take between three and seven days. This can change from lender to lender – and the exact timing varies between each one. However, the money doesn’t enter your account, it’s passed from lender to conveyancer.
Your solicitor will request the funds from the lender once everything is ready, with the money being transferred on completion day. Once this is done – the property is finally your home. It’s important to keep good lines of communication with the solicitor and lender to ensure a smooth process.
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