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Unlock Your Dream Home: 5 Mortgage Mistakes to Avoid in 2024!

Unlock Your Dream Home: 5 Mortgage Mistakes to Avoid in 2024!

February 27th, 2024

No matter where you are in your property journey, moving home can often feel overwhelming.

From finding the perfect property to putting your current home on the market, securing a mortgage, coordinating with surveyors, and liaising with conveyancers, there are numerous steps to tackle well in advance of your moving day.

In 2024, nearly one in six Britons are considering moving house. On average, Britons move homes four times in their lifetime, and the stress associated with each move remains consistent, regardless of one’s level of experience.

Some key home moving statistics from 2023:

  • First time buyers accounted for 54% of all home purchases this year.
  • Downsizers accounted for 31% of all buyer activity, looking to reduce overall spending and improve finances.
  • Higher mortgage rates led to more homebuyers funding the full purchase with cash. (24.4% of all purchases in 2023.

All this data reflects a market full of buyers being more careful with their finances, likely a reflection of the steep inflation and UK base rates which are now starting to decrease and stabilise in the new year.  

Regardless, here are some common mistakes people make when securing a mortgage for their new home, which YOU should avoid in 2024:

1.Not Checking Your Credit Score:

When considering purchasing a home, it’s crucial to assess your credit status early in the process. Your credit history and scores hold significant sway over your ability to qualify for a mortgage, dictating the rates and terms you may receive.

Not reviewing your credit early on is a common error made by some prospective homebuyers. If your credit falls short of your expectations, take proactive measures to enhance your score before seeking a mortgage loan.

For more information on improving your credit score check out Experians guide: https://www.experian.co.uk/consumer/guides/improve-credit-score.html

2. Not Obtaining an Agreement in Principle:

Before you look at properties, it’s advisable to secure a mortgage agreement in principle (AiP) from a potential lender, commonly referred to as a “mortgage promise.”

This document serves as a preliminary indication of the amount lenders are likely to lend you and typically remains valid for a period ranging from one to three months. 

Please note:

  • An AiP is NOT the same as an actual mortgage offer
  • It does NOT guarantee that you’ll receive the exact amount stated on the agreement. Rather, its primary purpose is to provide you with an estimate of your borrowing capacity, thereby guiding your property search within your financial means. Additionally, obtaining an AiP signals to estate agents your seriousness about purchasing a property and your ability to afford it.

3. Withholding Information:

Transparency and honesty are crucial when providing information to your mortgage adviser and lender.

Failing to disclose relevant details, such as changes in employment status or income, can result in complications or even the withdrawal of your mortgage offer.

When applying for a mortgage honesty is the best policy!

4. Skipping Advice from a Broker:

As self-promotional as it might sound, mortgage brokers can offer invaluable assistance:

  • Wide-ranging access to lenders
  • Deep understanding of the industry
  • Finding the ideal mortgage for your specific needs.
  • Facilitate pre-approval, granting you a competitive edge when making an offer on a property.

Speak to a broker for a more seamless mortgage experience.

5. Taking on Additional Debt:

Finally, avoid applying for new loans or financing before or during the mortgage application process. The more debt you have, the less you’ll be able to borrow.

Lenders evaluate both your income and expenditure, so any increase in debt could lead to a less favourable assessment or even a declined application.

At CMME Mortgages, we understand the challenges of moving home and strive to make the process as seamless as possible for our clients.

Our experienced advisers are here to guide you through every step of the mortgage journey, ensuring you secure the best deal for your circumstances.

Click here to book a FREE initial no obligation call and see what may be on offer for you no matter your circumstances.

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