Navigating the mortgage application process can often feel like trying to decode a secret language. Lenders’ requirements can seem inconsistent, overly complicated, or just plain baffling. At Hearthstone Mortgages, we’ve seen it all—from endless document requests to seemingly nonsensical questions. In this blog, we’re breaking down what lenders actually want and sharing tips to help you sail through the process.
The Basics: What Lenders Look For
Lenders want to ensure that you’re a low-risk borrower who can repay the loan. While different lenders have their quirks, there are some standard criteria they typically examine:
- Proof of Identity and Address
- Passport or driving license
- Recent utility bills or bank statements
- Income Verification
- Three months’ payslips (for employed applicants)
- Tax calculations and overviews (for self-employed individuals)
- Bank Statements
- Usually three months’ worth, showing regular income and responsible financial management.
- Credit History
- Lenders perform credit checks to assess your repayment history and financial stability. Forget the headline credit score; lenders focus on the details within your credit report.
- Proof of Deposit
- Whether it’s personal savings or a gifted deposit, lenders often require evidence of the source of funds to comply with anti-money laundering (AML) regulations.
Common Frustrations in the Process
While these requirements sound straightforward, many borrowers encounter roadblocks. Here are a few common frustrations we’ve seen:
1. Inconsistent and Repetitive Requests
Lenders often ask for additional documents in stages rather than upfront, leading to delays and frustration. Clients frequently ask, “Why didn’t they request this earlier?” The truth is, even we don’t always know—lenders’ processes can be unpredictable.
2. Overly Detailed Questions
Some requests seem excessive, such as asking for a two-year-old eBay link for a car sale or detailed explanations for small transactions. These questions often stem from rigid compliance requirements rather than practical needs.
3. Lack of Common Sense
Underwriters occasionally demonstrate a lack of understanding about property investments or unique financial situations. For instance, questioning why there are no mortgage payments on a bridging loan (where interest is typically retained) or failing to grasp the concept of letting agents managing distant properties.
How We Simplify the Process
At Hearthstone Mortgages, we pride ourselves on making the mortgage process as seamless as possible. Here’s how we help:
- Proactive Document Preparation: We know what most lenders typically ask for and ensure all essential documents are ready before submission.
- Advocacy: We act as your advocate, communicating with lenders to clarify their requests and push back on unreasonable demands.
- Transparency: We keep you informed every step of the way, explaining the reasoning behind each request and guiding you through any challenges.
Tips for Borrowers
Here are some tips to prepare for a smoother mortgage journey:
- Organise Your Documents Early Have your ID, proof of address, bank statements, and income verification ready before you apply.
- Avoid Credit Mistakes Don’t miss payments on any accounts while applying for a mortgage. Set up direct debits to ensure bills are paid on time.
- Be Transparent If there are any potential red flags in your financial history, discuss them with us upfront. We can often find solutions before they become issues.
- Respond Quickly Prompt responses to requests for additional information can help keep your application on track.
Final Thoughts
Lenders aren’t perfect, and their processes can be frustrating. However, understanding their requirements and working with an experienced mortgage advisor can make all the difference. At Hearthstone Mortgages, we’re here to navigate these challenges with you, ensuring your application is as strong as possible and helping you achieve your property goals.
Have questions about the mortgage process or need assistance with your application? Get in touch with us today to learn how we can help.
