After all, before we can purchase a property and move in, we need to get the bank to agree to lend us the money, also known as mortgage approval in principle.
It’s also good to start this process well ahead of time before you go looking for a home.
Actually, it’s essential that you secure the mortgage before you go house hunting because real estate agents won’t even engage or help you unless you’ve secured your mortgage.
So, we should start the mortgage process at least 4 to 6 weeks earlier. And remember that once granted, the mortgage approval will last for six months so you’ll have plenty of time to find a property!
What does the bank look at when they consider a mortgage application?
- Income
- Showing the bank that you can meet the repayments
- This is a big one, and the banks will look for proof that you can repay the new mortgage based on your:
- Monthly savings (they want to see that they are consistent)
- Rent can be seen going out of bank account
- Loans that you may be paying that will be gone
- Banks will look at the profile of the borrower.
Basically, does it make common sense (and good business!) to issue a mortgage in principle to this applicant? To judge that, they don’t want to see any evidence of gambling, missed direct debits, people living in their overdraft, etc. If you have missed payments or loans in your past, it will create big problems during the mortgage process. The banks will look at the Central Bank credit register, so it’s best that we check that now.
For more personalised advice on ‘Mortgage approval in principle’ contact JC Mortgages
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