Mortgage, Loan & Insurance Guides

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The mortgage process explained

Buying a home is one of the largest financial commitments most people will ever make. It can be an exciting, stressful and a daunting experience – even if it’s not your first time. We have created this simple guide to help explain the key mortgage milestones, so that you know what to expect at each stage of the mortgage process. Our expert team of Mortgage and Protection Advisers will be here to guide you each step of the way.

Searching for a new home

We encourage buyers to start exploring the different mortgage options as soon as they start to consider buying their first home or moving home. Often, we get so caught up in all of the excitement of choosing a property that we forget to check whether we will be able to afford the desired property.

Our mortgage calculators can give you an indication of the amount you could borrow and how much the loan will cost you every month.

Mortgage in Principle / Decision in Principle

When you have found a few properties which you are interested in and know how much you need to borrow, call our qualified whole of market Mortgage Advisers on 01702 533 400 for an accurate quote – or arrange a callback.

Our advisers will complete a Fact Find which will enable them to be able to recommend the best mortgage for you, based on your income and circumstances. They will then produce a Key Fact Illustration (KFI) detailing all the costs associated with the arrangement of your mortgage. If you are happy with the product we have recommended, we will submit your details to the lender who will perform a search on your credit file. Many but not all, lenders carry out what is known as a soft search.

A ‘soft’ search does not show on your credit file, it just simply allows the lender to decide whether they wish to lend to you. If the lender thinks that they will lend to you, pending satisfactory documents, credit checks and valuation, then they will issue you a Mortgage in Principle Decision in Principle.

Making an Offer on a Property

By this point you’ve found your dream home and are ready to make an offer. In some cases, you may need to produce a Mortgage in Principle agreement/Decision in Principle from a lender to show the estate agent and seller that you are able to buy the property.

Once your offer has been accepted, our Mortgage Adviser will be able to process the full mortgage application. We will need to underwrite your application before sending it to the lender. This means that we will need to fully assess your income and expenditure, credit profile and references. Normally we will need you to supply us with the following documentation to allow us to do this:

  • Last 3 months bank statements
  • Last 3 months payslips/ SA302 or Accounts if self-employed
  • Information from credit reference agencies
  • Your employer’s details
  • Proof of identity such as a passport or driving license

Once we are happy that the documents match the information you have previously provided us with, we will begin to work with the lender to process your application. At this stage the lender can still reject your application if they are not happy with the property, amount you wish to borrow, your employment status or income. If a lender does decline your application then we will try to explain the reasons for this to you and cascade your application to the next best available product.

Instructing a Solicitor

A qualified solicitor will need to carry out the conveyancing work on the property which you want to buy and if you are also looking to sell a property then they will communicate with the buyer’s solicitor on your behalf.

What does conveyancing work include?

  • Obtaining the property deeds.
  • Researching where the legal boundaries of the property lie and informing you of this.
  • Researching local planning information to ensure there are no known developments or new roads which could potentially affect the future value of the property.
  • Preparing a fixtures, fittings and contents list so that you know exactly what will be left in the property when you move in.
  • Advising you on a draft contract for sale, prepared by the seller’s solicitor.
  • Agreeing a completion date with you and the seller.

Most lenders will allow you to choose your own solicitor however some use a restricted panel. Your Mortgage Adviser will inform you of this if this is the case. Ingard works with an approved panel of solicitors who have strict service level agreements in place to ensure they act quickly and efficiently on our client’s behalf. Get a free quote for your legal fees from our approved panel.

Property Survey & Valuation

You will need to instruct a survey and valuation to be carried out on the property. You can choose the type of survey which you want to be conducted, the three options you can choose from are listed below.

Condition Report

This is the most basic report and is largely for the benefit of the lender. It provides a basic valuation and assesses the condition of the property for the purpose of lending.

Home Buyers Report

This is a more detailed report which will tell you about any serious problems, such as damp. It includes a valuation and insurance reinstatement value should your property burn down. This report does have its limitations though, the surveyor will not look behind furniture or under floorboards, and they will only take into account areas which are easily accessible so there could be underlying issues with the property that they do not spot.

Building Survey

This is by far the most comprehensive report and therefore costs more. However, it may be worth the investment if the property is old, an unusual construction or has any obvious reasons for concern. The surveyor will check every part of the property, including beneath floorboards and behind walls. The report will include advice on any areas of concern, with estimated timings and costs for repairs.

Finalising your mortgage offer

Once the lender has finished processing your mortgage application and they have confirmed that they are happy with the property valuation, the lender will send you a formal offer. If you are happy to proceed then your solicitor will be sent a copy which will then allow the solicitor to arrange for the contracts to be exchanged and a completion date to be set.

Congratulations

On the agreed completion date you will be able to collect the keys for your new home.

If you would like any further information then please call our Mortgage and Protection Advisers on 01702 533 400 or email info@ingard.co.uk.

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