For a first time buyer, there is a multitude of requirements you need to meet when it comes to buying your own home. When purchasing a property, there are certain pieces of information a mortgage lender will require from you, and without this information, you will be unable to go ahead with your mortgage application.
Here are some of the most crucial things you should be prepared to answer or provide your mortgage lender:
Proof of identity and address
A first time buyer, like anybody wishing to buy a home, must provide this information to any financial firm. By law, you are required to provide at least one proof of identity and one proof of address for each person who will be signing for the mortgage.
Proof of identity could include a current, fully-signed passport or a current EU driving license. Accepted forms of proof of address may be a bank statement, dated within the last three months, or a current UK paper driving licence.
Proof of income
Before your mortgage application, the lender will check that you are able to afford your mortgage payments. This will include totalling up your basic salary, as well as any freelance work you do. Furthermore, it will comprise of any benefits, commission or bonuses you receive.
Each mortgage lender has different requirements, but whatever type of mortgage you decide on as a first time home buyer, you will likely need to provide at least three months’ payslips.
Other income questions
The lender will also want to know about how likely your salary is to change in the near future. As a first time buyer, it is more likely you will change jobs rather than retire, but whatever your circumstances, the lenders will want to be sure you are able to afford the repayments.
Some lenders may also require more information, such as how long you’ve been in your current job or if you are planning to become self-employed.
Do you have children?
If you are a first time home buyer with children, this could affect the amount of money you can borrow from mortgage lenders. Parents may qualify for smaller mortgages than people in similar positions to them without children.
Similarly, you may also be asked if you are planning to start a family in the near future.
How much money do you spend?
Mortgage lenders may well ask you this question to gauge how frugal or frivolous you are with your money. This will give them an indication of how responsible you are with your finances. They may ask you to provide information on how much you spend on specific items, ranging from nights out to haircuts.
Other items you should be prepared to be asked about include: clothing, cigarettes, mobile phones, internet/TV subscriptions, socialising, gambling, gym membership and dental care. This isn’t exhaustive so you should be prepared to talk through your finances and outgoings in detail.