Should I remortgage my home?
The main reason to remortgage your home is to save money on your monthly payments. There are a few instances when you should not remortgage. If you would have to pay a penalty or early repayment charge for leaving your current lender or if interest rates have gone up.
What information is required to remortgage?
As you already have a mortgage we would ask for full details of this, to include, mortgage balance, remaining term and monthly payment along with current interest rate and confirmation of when your product expires so that we can avoid any penalties. In addition, we would need full details of your income and expenditure and a copy of your credit report to check the conduct and balances of all credit commitments you have now and those in the past. By obtaining all this your chances of success are higher and we can manage your expectations from the outset.
Have your paperwork ready
All mortgage lenders will request income verification when applying for a mortgage. The amount of documentation required can vary depending on lender.
For all mortgage applicants we ask for the same checklist of information.
- Latest 3 Months Payslips
- Latest P60
- Last 3 months bank statements showing income and expenditure
- Last 3 Years Accounts / Tax Returns / Tax Calculations (if self employed)
- Evidence of ID (Passport and Driving Licence if both held)
- Proof of Address (Utility Bills / Bank Statements – usually dated within last 3 months)
- Proof of deposit (if applicable)
Credit Report – we ask all clients to provide us with a credit report as this will give us a clear picture of your financial standing. Your report should show us current and previous loans, credit cards, overdrafts, mortgages for the last 6 years. This will help us make an accurate application which increases our chances of success.
There are several providers you can obtain a report from some of which are free and others you may have to pay for after an initial free period:
We would tend to recommend using any of the following as they provide a more comprehensive report with your details:
Sometimes there may be an entry on your credit file that you are unaware of which can have a negative effect on your file and affect who we can apply to. In obtaining your report we can find this out now before applying for a mortgage.
Lenders reserve the right to ask for some further documents, but these core ones are likely to be the minimum requirements.
Key Factors that will improve your chance of success:
Register on the electoral roll
A lender needs to be able to establish where you live. Being present on the electoral roll will improve your credit score. To add yourself to the electoral roll you can go to:
When applying for a mortgage a lender may ask to see your bank statements to establish spending patterns. Lenders could be concerned if you are always in your overdraft as this may suggest that a mortgage commitment is unaffordable, particularly if an applicant was living at home for example. In conducting your bank account well it demonstrates you have a good understanding of managing your money which lenders would consider a positive. Lenders will also pay attention to what you spend your money on – such as online gambling,
Managing existing commitments
It is important that any commitments you have are well managed. For example, if you have a credit card ensure the balance remains within your agreed limits and do have a direct debit in place for collection of minimum payments. Late payments on credit commitments can reduce your credit score.
Avoid applying for credit
If possible avoid applying for credit of any kind for a minimum of 3 months when considering applying for a mortgage. Regular activity on your credit file along with increasing balances will reduce your score and also how much you may be able to borrow. Especially try to avoid payday loans, mortgage lenders take a dim view where these are present within 12 months of applying for a mortgage. They will lower your credit score and in some cases, lenders will decline your application as a result of having one previously.