Mortgages
Preparing for a Mortgage: What to Organise Before You Apply
A mortgage lender checks your deposit, income, existing commitments, and credit history. The credit history check is where preparation pays off most: errors or a thin record take months to correct, so check all three credit agencies well before you apply.
- Check all three credit agencies before applying
- Deposit of 10%+ gives access to better rates
- Use a soft-check eligibility tool before applying
Wisemium's Credit Readiness section gives goal-specific preparation guidance. Track your bills to show consistent payment history.
Mortgage preparation
- Credit agencies
- All three checked
- Electoral roll
- Registered
- Deposit
- On track
Example. Your own details appear once you add them.
What a lender checks
Deposit
5% minimum; 10%+ for better rates
- Bank statements covering 3 to 6 months
- Gift letter if part is from a family member
- Must be genuine savings or a genuine gift
Income
Usually 4 to 4.5x salary
- Last 3 months of payslips and a P60
- Self-employed: 2 to 3 years of accounts
- Base salary used; bonus sometimes counted
Credit history
Check all three agencies
- Register to vote at your current address
- Pay every bill on time
- Keep credit card balances well below their limits
The full guide
A mortgage is the largest financial commitment most people make, and lenders check several things carefully before approving one. None of the preparation is complicated, but it takes a few months to work through systematically, and some things — such as your credit report — are much easier to correct before you apply than after.
What a lender checks
| What lenders check | Why it matters |
|---|---|
| Your deposit | The bigger the deposit, the lower your loan-to-value (LTV) ratio, and the better the rates you can access. Most residential mortgages require at least 5% of the purchase price; 10% or more gives access to a wider range of rates. |
| Your income | Lenders use income to calculate how much you can borrow. Most use 4–4.5 times your annual income as a guideline, though this varies. |
| Your existing commitments | Loans, credit card balances, car finance and other regular payments all affect what a lender considers affordable. |
| Your credit history | Late payments, defaults and high credit utilisation can affect the rates you are offered or whether you are accepted at all. |
| The property | Lenders value the property independently. If their valuation is lower than the purchase price, it affects the loan amount they will offer. |
Your deposit: how much and where it came from
A lender will ask for evidence that your deposit is genuine savings or a genuine gift. This means bank statements typically covering the last three to six months. If part of the deposit is a gift from a family member, the lender usually asks for a letter confirming it is a gift and not a loan. If any part of the deposit was borrowed, tell the lender: failing to disclose it is treated seriously.
Your income: what evidence you need
For an employee, this is usually the last three months of payslips and a P60. For someone self-employed, lenders typically ask for two or three years of accounts and an SA302 tax calculation from HMRC. A lender uses your base salary, not bonuses, as the reliable income figure for the maximum loan calculation, though some lenders will include a proportion of regular bonus or commission.
Your outgoings: what counts
Lenders review your regular monthly outgoings as part of an affordability assessment. Things they look at include loan payments, credit card minimum payments, car finance, childcare costs and subscriptions. Having a clear picture of what you pay each month before you apply makes the conversation with a lender or a broker more straightforward.
Your credit report: check all three agencies first
Your credit report matters because a lender uses it to verify your identity, check your payment history and see your existing commitments. Three credit reference agencies hold UK reports — Experian, Equifax and TransUnion — and a lender may check one or more. Check all three before you apply, and correct any errors while you have time. See How to get credit-ready before you apply for the steps.
- Make sure you are registered to vote at your current address.
- Check that old addresses are listed correctly and old financial links are closed.
- Pay every bill on time for at least six months before you apply.
- Keep credit card balances well below their limits.
- Do not apply for new credit in the months before a mortgage application.
Using a mortgage broker
A whole-of-market mortgage broker has access to lenders not available directly, can advise on which lender is most likely to accept your application given your circumstances, and handles much of the paperwork. Brokers are regulated by the FCA. Some charge a fee; others are paid by the lender. Wisemium does not provide mortgage advice and is not a mortgage broker.
Wisemium's Credit Readiness check gives a goal-specific preparation result for mortgage applicants.
Common questions
How long does mortgage preparation take?
The preparation itself — organising documents, checking credit reports, building savings — can take six to twelve months if anything needs attention. The application itself, once documents are ready, typically takes four to twelve weeks.
Does checking my credit report affect my mortgage application?
No. Checking your own report is a soft search. It has no effect on your record and lenders cannot see it.
Can I get a mortgage if I am self-employed?
Yes, though lenders need more evidence of income. Two or three years of accounts and an SA302 from HMRC are typically required. Some specialist lenders work specifically with self-employed applicants.
What is a mortgage in principle?
A mortgage in principle (also called an agreement in principle or decision in principle) is a conditional offer from a lender based on a soft credit check. It tells you roughly what a lender would offer and is often useful when making an offer on a property.
Useful to someone you know?