Can’t afford to buy a home?

Here’s how to increase what you could borrow on a mortgage

According to figures from the Land Registry*, the average house price in the UK is now more than £280k. Wages haven’t grown in line with property prices which makes it hard to buy a new home. If you’re finding affordability a challenge, here are some tips to help with your budget

1. Reduce debt
   Lenders will look at how much you already owe while considering your mortgage application. If you have other debt like credit cards or car loans, do what you can to pay them off.
2. Cut spending
   Think about whether you could eat out less and manage without extra TV channels, gym membership and leisure subscriptions. Gambling payments on your accounts could also be a red flag to a lender so if you can’t remove them altogether, make sure they’re under control and as low as possible.
3. Lower your childcare costs
   If you have family or friends nearby that can help with childcare, make the most of it, even if it’s just in the run-up to getting your new mortgage.
4. Boost your income
   If you haven’t had a pay rise for a while, ask whether your employer would consider increasing your salary. Bonus payments are also helpful when lenders review your finances, especially where you’ve received one more than once.

   Where a raise isn’t possible, take as many overtime hours as you can. You could even start up your own business based on a skill or interest you have, which might help increase what you earn or take a second job. However you can boost your income, you should do it for at least 6 months before you apply for a mortgage.

5. Check credit score
   Your credit score will be reviewed as part of the mortgage application process. You can improve it by doing some of the things listed above like repaying debt but it’s also worth running a couple of checks yourself to make sure it’s accurate (errors can occur) and there’s no fraudulent activity. There are ways to ‘boost’ your credit score by linking it to your bank account and factoring in regular payments like council tax. Read more about how to improve your credit score on the Money Saving Expert website here*.
6. Borrow for longer
   We’re all living and working longer nowadays, and lenders have increased the maximum age limits for customer so it’s worth considering whether a longer mortgage term might allow you to borrow more.
7. Borrow with family
   There are mortgage products available which allow you to buy with a family member (like a parent or grandparent) without them living in the property. Read more about these mortgages here.
8. Buy with a friend
   Buying with someone else combines your incomes meaning you can borrow more. However, this is a big decision so you should think carefully before investing in a new home together. Your finances will be linked (so your credit score could be impacted by their actions), and you’ll have to think about what happens when one party wants to move out or sell.
9. Your job could affect how much you can borrow
   It’s likely you can borrow more with some lenders if you’re a professional. Teachers, NHS staff and other key workers are also awarded preferential income multiples by some lenders. We know which lenders favour which professions so get in touch for help.
10. Helping hand
    There are special offers available for first time buyers with certain lenders where there’ll lend more if you meet specific criteria.
11. Borrowing more when you’re self employed

• • Poor returns in recent history
    We can help you find a lender that will consider your most recent year of trading (where previous years’ results have been lower).
  • Business income over personal salary
    As a company director, you can present the net profit of your business as income to the lender instead of what you draw personally.

We could help

As experienced mortgage advisors, our team know where to look for the most favourable borrowing options and can help present your mortgage application in the best light.

Talk to us today:

01275 370360
contact@mortgage-style.co.uk

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP TO DATE WITH YOUR MORTGAGE REPAYMENTS.

A fee may be payable if we progress your application. Our average fee is around £200 and the maximum you may pay is £995 for Retirement Interest Only products.

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