Simon Lambert (Motgage Advisor) gives expert video advice on: What do I need in order to get a mortgage?; I'm self employed. Can I still get a mortgage?; I've got a criminal record. Will I still be able to get a mortgage? and more...
What do I need in order to get a mortgage?
In order to get a mortgage, you will need an income. To take out a mortgage you need either a property that you own, if you want to borrow money against it, or a property that you want to buy, You'll need a good credit history and stable employment prospects to be accepted for a mortgage.
What might stop me from getting a mortgage?
You might not be eligible for a mortgage if you have a bad credit history, you don't have an income or you find it very difficult to prove what you earn. If you have a bad credit history, the mortgage lender will not want to lend to you because they may not feel that you'll pay the money back. If you don't have an income, then the lender may feel that you can't meet your monthly mortgage payments and so are not eligible to take out a mortgage. If you can't prove what your income is, then you'll have the same problem.
I'm self employed. Can I still get a mortgage?
You can still get a mortgage if you're self employed, and there's no reason why you shouldn't. However, you may find it harder to prove what your income is if you're self employed. In order to do this, you can either get a self-certification mortgage, whereby you prove to the mortgage lender what your earnings are, but you may pay a higher interest rate on this, or, if you have annual accounts, you may be able to get your accountant to prove that you earn a certain amount of money, that means you can cover the mortgage.
I'm unemployed. Will I still be able to get a mortgage?
If you are unemployed, you will probably find it very difficult to get a mortgage unless you can prove that you have a source of income from somewhere else. The reason being that if you're unemployed and don't have any money coming in, the mortgage lender won't believe that you can pay that mortgage back.
I'm under 21. Will I still be able to get a mortgage?
If you're under 21, you'll find it harder to get a mortgage, but it's not impossible. Most lenders will have criteria that say they will not lend to under 21 year olds. However, if you've got a high-powered job and you earn good money, or you come from a wealthy family, or you can prove that you have a guarantor who will back you up if you can't meet those mortgage payments, there's no reason a lender won't lend money to you.
What's a county court judgement?
A "County Court judgment" is taken out against someone when they fail to pay a debt. For example, if I employ someone to do a job for me, they do that job and I don't pay them that money, they can take me to court to try to claim that money. If I borrow money on a credit card and I default on it and I don't pay it back, then the credit card company can take me to court for that money. The court will issue a judgment, which is generally called a "County Court judgment."
I've got a county court judgement. Will I still be able to get a mortgage?
If you have a county court judgement, it will impact on your credit history, because it means that you haven't paid someone back some money that you owed them at some point. However, there's no reason why that means you won't get a mortgage. It may be that many high street mortgage lenders will lend you money if you've only got one county court judgement, or you can prove that those county court judgements that you do have were a long time in the past. However, if they're closer to now, then you'll probably still be able to borrow money, but it may be at a higher rate from a different lender.
I've got a criminal record. Will I still be able to get a mortgage?
If you have a criminal record, you may still be able to get a mortgage. It depends what the crime was, and how long ago it was. The mortgage lender will make up their own mind as to whether they will lend you money. If you have a criminal record for a small offence that happened a long time ago, it's unlikely that a mortgage lender will hold it against you. If you have a criminal record for arson and fraud, and you were found to have burned down your own house and then defrauded the insurance company, it's fairly likely that the lender will turn you down for a mortgage.
I've been declared bankrupt in the past. Will I still be able to get a mortgage?
You can still get a mortgage if you've been declared bankrupt in the past, but you will find it much harder than anyone else. Unfortunately, if you've been declared bankrupt, it will have a serious impact on your credit history, and you may find that most mortgage lenders will not be willing to lend you money.
I've got a bad credit record. Will I still be able to get a mortgage?
If you have a bad credit record, there's no reason why you can't get a mortgage. But it depends how bad that credit record is. If your credit record is only mildly bad -- you haven't paid back some credit card debts, you haven't paid back some loan debts -- then you may find that a High Street lender will lend you money. If your credit record is really very bad, then you may find that you have to go to a specialist mortgage lender, who will only lend you money at a higher rate. If you have an absolutely disastrous credit record that runs right up until the moment you walked into the bank, then they probably won't lend you any money as a mortgage.
What is a bad credit record?
A bad credit record refers to the credit history that you have when someone checks on you if they're going to lend you money or sign you up to a financial contract. If you haven't paid back credit card debts and loan debts, or you've even just refused to pay your gas bill, then you're going to have a bad credit record.