If you are planning to move house or apply for your first mortgage it is best to consider a few spending constraints. Once you know when you want a mortgage, you must do everything possible to avoid new problems appearing on your credit report.

So don’t make any credit applications in the few months before asking for a mortgage, nor between getting an offer and completing. This includes, such as, not getting a new car on finance until after you have moved! If you have to, then keep the cost down as much as possible.

if you have any 0% deals ending in the next few months, pay down that balance as fast as possible as you don’t want to have to refinance that just before a mortgage application.

if you cancel any direct debit, double-check your account is clear first. Be especially careful if you change mobile contracts because they are a common cause of credit record problems if the last bill isn’t fully paid.

Make sure credit card balances are reducing and that you are paying more than the minimum amounts due. The mortgage lender can see not just your current balance but also your borrowing and repayment history. Ideally don’t spend on the cards at all if you are trying to reduce a balance.

If you have several credit cards with a zero balance, think about closing at least one. If you are trying to show a mortgage lender that you won’t get into future debt trouble, getting rid of that spare card is a simple way.

Absolutely no payday loans in the year before a mortgage application. Even if you can repay it on time, many lenders see these as a sign of financial problems.

If you have an overdraft, try to reduce it. If you don’t have an overdraft, make sure it stays that way!

Keep your “discretionary expenses” well under control. When someone says their recent bank statements aren’t normal because they went on a good holiday in November and then it was Christmas, the lender is likely to think that these things happen every year!

Don’t change jobs!  This may not be under your control but if you have any choice, this is not the time to switch employers. If you do, you may have to postpone thoughts of a mortgage for 6 or 12 months or longer if you become self-employed.

Don’t change your name! It won’t stop you getting a mortgage but it can cause temporary problems on credit records so why take the risk. If you have just got married, leave changing the name on your accounts until after you have moved.

Getting that mortgage – who and how to apply to

Unless your credit record is healthy, it is good to go through a broker who should be able to advise which lenders will be happy with your credit record.

Every lender is different. Not only do they use their own assessment calculations, but some are more flexible than others. Some high street lenders adopt a ‘computer says no’ approach to low and average deposit loans if you have any recent credit record problems at all. If you have a very large deposit, some lenders may be more willing to accept an application with recent problems.

Contacting banks individually can waste a lot of your time and any rejected mortgage application will leave a ‘footprint’ on your credit record. So if any of the following apply, consider going to a mortgage broker instead:

You have a low deposit;

You need a large loan in relation to your income;

Your credit history isn’t very good; or

There is anything unusual about your situation.

But it is the mortgage company that makes the end decision and not you if you can get a mortgage. If you have applied for a mortgage recently and have been rejected please read this link to help you remedy that issue.

Look further at our Quick Property Sale blogs on this subject here.