Boost your mortgage chances

Boost your mortgage chances
Sort your finances before you apply

Securing a mortgage can feel like scaling Everest, particularly with steep interest rates and a cost-of-living squeeze impacting your finances. However, there are strategies to enhance your likelihood of approval. This guide presents our 18 best tips to increase your chances of securing a more affordable mortgage deal.

1 – Don’t expect every lender to fancy you

Each lender has a distinct approach to determining whether to approve a loan application. If you meet the lender’s specific requirements, you may receive a prompt approval. However, if your profile falls short of their ideal criteria, the likelihood of rejection increases.

For individuals who fall somewhere in between, the situation is less clear-cut. In these cases, the lender’s decision will hinge on a variety of factors, including:

• The size of the loan you want to take out. The amount you want to borrow will be considered in relation to your household income and how much you can afford.
• How much you’ve saved as a deposit. The bigger your deposit, the less of a risk you’ll likely be seen as.
• Details of your incomings and outgoings. This is the money you’ve got coming in, such as your salary, and how you spend your money.
• Your employment status. Permanent employees often have an advantage when it comes to securing a mortgage compared to those in temporary positions, the self-employed, freelancers, contractors, and individuals with less conventional job roles. If your employment situation makes it challenging to obtain a mortgage, a mortgage broker can help you find a lender who is more likely to approve your application.
• Your credit rating and history. More on this below in point two.
• Your existing debt. This could include credit card debt, loans you’ve got, overdraft availability used, buy now, pay later balances and so on. (Do note that mortgage lenders treat student loans differently from other debts – see more in our Student loans and mortgages guide.)

Meeting a lender’s criteria increases your chances of securing a loan, but it doesn’t ensure approval.

It’s also important to note that lenders can adjust their criteria over time, which might make obtaining a mortgage more challenging for some individuals. Therefore, even if you were approved for a mortgage previously, don’t take it for granted that you’ll receive approval again from the same lender.

Where does the lender’s information about me come from?

The information is gathered from various sources, such as your application form, any previous accounts you’ve maintained with that lender, and details noted on your credit report.

Your application form

This document will contain your personal information along with details of your existing credit obligations. Additionally, it will include specifics about the property you wish to purchase.

Review this information meticulously. If you’re applying online, make sure to verify every entry you’ve made. For those applying via telephone, confirm that the mortgage advisor has accurately recorded all details. Even a minor error, such as listing a salary as “£3,500” instead of “£35,000,” could derail your current application and potentially impact future ones as well.

Any past accounts you’ve had with that lender

When you apply for a mortgage with a lender you’ve previously interacted with—such as having held a credit card with them—the lender will use this prior information to enhance its understanding of your financial profile.

Your credit files

The three main credit reference agencies in the UK—Experian, Equifax, and TransUnion—gather and maintain data that they share with potential lenders. These agencies play a crucial role in evaluating your financial profile by providing information to all lenders who review your credit history.

The details collected by these agencies encompass various elements such as court judgments, fraud alerts, and records of your credit cards, utility agreements (including gas, electricity, and water), mobile phone contracts, overdrafts, loans, and bank accounts.

2 – Check your credit report before they do

Check your credit report before the mortgage lender does. To persuade mortgage lenders that you possess the financial discipline necessary to repay a loan, it’s essential to demonstrate a strong track record of managing your finances. Lenders often assess your credit report to evaluate your history of making payments on time.

Your credit report provides a comprehensive record of all your open accounts from the last six years, including:

• Credit cards
• Loans
• Overdrafts
• Mortgages
• Some utilities
• Buy now, pay later payments

In the UK, there are three main credit reference agencies: Experian, Equifax, and TransUnion. Each of these agencies generates its own credit report about you. You can review these reports at no cost—our guide on how to check your credit report for free provides detailed instructions.

It’s important to ensure that all of your credit reports are accurate and up-to-date, as you can’t predict which one your future mortgage lender will consult.

Can I get a mortgage with a poor credit report?

A less-than-stellar credit history doesn’t necessarily disqualify you from securing a mortgage, but it can certainly diminish your chances. To maximize your likelihood of approval, it’s wise to improve your credit report before submitting your mortgage application.

For tips and help on how to bolster your credit report, see our Credit scores guide.

What’s recorded on my credit report?

All lenders use at least one agency when assessing your file. Your credit report contains data from five main sources:

• Electoral roll information. This is publicly available and contains address and residence details.
• Court records. County court judgments (CCJs) and bankruptcies indicate if you have a history of debt problems.
• Search, address and linked data. This encompasses details of other lenders who have checked your credit file when you applied for credit, addresses associated with you, and any individuals with whom you share a financial connection.
• Fraud data. If you’ve committed a fraud (or someone has stolen your identity and committed fraud) this will be held on your file. More info below.
• Account data.Banks, building societies, utility providers, and various other institutions maintain records of all your financial activities, including transactions and payments related to credit or store cards, loans, mortgages, bank accounts, energy services, and mobile phone contracts.

Furthermore, payday loan information is typically documented, and ‘doorstep lenders’ are required by law to disclose the data they maintain about you. Additionally, if you utilize buy now, pay later services, data from these providers is progressively being communicated to credit reference agencies as well.

Credit reference agencies will usually know:

– How much you owe
– How long you’ve had the relationship for
– Details on your financial behaviour, such as late or missed payments
– The final outcome and date of any closed financial accounts
– Financial links with other people (such as a joint bank account or mortgage)
– Details of any hard credit checks (for example, because you’ve previously applied for credit)
– Any defaults or county court judgements in the last six years
– Whether you’re bankrupt or in a formal debt relief plan

What’s not recorded on my credit report?

There are many myths about what information is held on credit files. Don’t be fooled, though. They hold an enormous amount of financial data, but there’s lots they don’t know about you.

The following things are NOT listed on your report:

• Buying habits (in other words, what you tend to buy)
• Race, religion, colour, medical history or criminal record
• Information on relatives (unless you’ve a joint financial product with them)
• Parking or driving fines
• Salary
• Council tax arrears
• Savings accounts
• Student loans (unless taken out pre-1998). See more in our Student loans and mortgages guide.
• Old defaults or missed payments (from six+ years ago)

‘I use gambling websites – will this show up on my credit report?’

Gambling transactions aren’t recorded on your credit report, so they don’t directly affect your credit history.

However, when a lender reviews your mortgage application, they will examine your bank statements, which include details of any payments made to gambling sites.

Although frequent online gambling doesn’t automatically disqualify you from obtaining a mortgage, lenders are interested in your overall financial management and ability to meet repayments. A high volume of gambling transactions or multiple gambling accounts might raise red flags, especially if you’re close to the threshold for mortgage approval.

If you’re a regular gambler but manage your spending responsibly, it’s advisable to consult with a mortgage broker. They can help you find a lender who is more likely to view your application favorably.

If you don’t feel your gambling is under control, and are concerned that this could affect your mortgage chances (and is impacting your life in other ways), it’s best to seek specialist support from organisations such as GambleAware or GamCare.

3 – Correct credit report errors pronto

If you find inaccuracies on your credit report, you have the right to address them—whether by correcting the mistake or by voicing your concerns.

Start by verifying whether the error appears on credit files with other agencies. Next, reach out to the lender to discuss the issue. If these steps don’t resolve the problem, you can seek assistance from the free Financial Ombudsman, who can intervene and mandate the necessary corrections.

Here’s our step-by-step help:

• Check your file with other agencies. Check whether the same error appears in your file with other agencies. If you manage to resolve the issue with one agency, the corrected information should be shared with the others. However, it’s advisable to contact each agency directly to confirm that your file with TransUnion, Equifax, and Experian contains accurate details.
• Contact the lender. Most organizations have established procedures for handling customer disputes, and if you have evidence to support your case, the issue should be addressed promptly. Reach out to them, explain why you believe the error is unjust, and request that it be removed from your record.

If the dispute involves a default and you’re willing to reach a settlement with your lender—whether partial or complete—you might also consider negotiating with them. As part of the settlement terms, you could propose that the default be removed from your credit report. Companies are often able to eliminate disputed defaults under such arrangements.

• Speak with all three credit reference agencies. If the lender isn’t cooperating, reach out to the three credit reference agencies and request that they add a ‘notice of correction’ to your credit file.

This notice allows you to clarify the circumstances behind the default. Be direct and to the point, as this explanation will be included in your credit report. For instance, you might write, “The account was joint, and the debt accumulated after separating from my ex-partner.”

Although this might slow down future credit applications, as many companies will review it manually, it’s generally not an issue if the default is significant enough to affect your creditworthiness.

• If the lender won’t help, complain to the Ombudsman. If you think an error has been handled unfairly and reaching out to the lender hasn’t resolved the issue, you have the option to approach the Financial Ombudsman Service. This free and independent organization serves as the official mediator for resolving conflicts between individuals and financial institutions, offering an unbiased judgment on the matter. It can rule both that the debt is unfair (if it is) and that the default can be wiped.

4 – Register to vote or your chances might be scuppered

This could be a significant hurdle. Although having an impeccable credit report doesn’t necessarily require being listed on the electoral roll, securing a mortgage without it can be quite challenging. Lenders rely on electoral roll information for identity verification—to confirm your identity, your residence, and to rule out any money laundering activities.

Your credit file will say if you’re on the electoral roll or not, but you can also check with your council. Do this as early as possible. While you can usually be added within a month, in late summer and early autumn it could take longer.

If you’re not on it, you can register on the electoral roll for free.

If you’re not a national of the UK, Ireland, or the EU (or a Commonwealth citizen with the right to reside in the UK), and therefore can’t be included on the electoral roll to vote, you still have the option to add a notice of correction to your credit file. This notice can indicate that you have alternative forms of address and identification that you can provide to lenders, assuming you do in fact have them.

5 – Delink from ex partners or flatmates to stop their credit history wrecking your chances

If you share financial connections with someone—such as through a joint bank account, mortgage, or loan—and you are now separated or have no ongoing involvement with them, it’s crucial to sever that financial link.

Failure to do so could result in their financial missteps, such as late payments, negatively impacting your credit. Reach out to credit agencies and request a ‘notice of disassociation’ to rectify this.

Be aware that you might still be connected to former flatmates if you had a joint account for shared expenses. It’s important to verify that their credit history isn’t affecting your own. If it is, act swiftly to disassociate.

Even if your former financial associate has a clean record now, you could still face issues if they fall behind on payments in the future. Our Credit scores guide has full details of what to do.

6 – Carefully manage your available credit

This article explains the concept of available credit, which encompasses the total amount of credit you can use across your credit cards and overdrafts. Essentially, it represents the difference between the combined balances in your debit accounts and the total of your credit and overdraft limits.

It’s crucial to find a middle ground when managing available credit. Having too much available credit might signal to lenders that you’re at risk of accumulating excessive debt if you were to use it all. Conversely, nearing your credit limits can indicate you’re operating on the edge of your financial capacity. As noted by the credit agency Experian:

• If you have debts, lenders prefer that they make up less than half of your available credit. To be really safe, try to keep any debts equivalent to 25% of your available credit. So if you’ve a combined limit of £10,000, lenders rather you use less than £5,000 of it, but ideally sticking nearer to the £2,500 mark.
• If you are using a decent proportion of your available credit, avoid lowering your limits so you’re suddenly close to the edge. Similarly, don’t have tens of thousands of pounds of available credit unnecessarily – new lenders get twitchy that you could suddenly be far more indebted than you currently are.

Keep in mind that certain lenders may factor in buy now, pay later debts and your available credit when assessing your financial situation, especially if you owe significant amounts to several buy now, pay later services.

Unfortunately, determining credit limits is more of an art than an exact science, and each lender has its own perspective on how much credit is appropriate for you. It’s generally advisable to use no more than 25% of your available credit, but if you need to exceed that, ensure it doesn’t go beyond 50%. Ideally, you should strive to pay off any outstanding debt whenever possible.

7 – Close old, inactive accounts – they can kill your application

If you’re not actively using an account, it might be a good idea to close it. An open but unused account can pose a risk of fraud and may show outdated information.

However, when applying for a mortgage, having longer, stable credit histories can be advantageous. Therefore, if you have two credit cards—one that’s relatively new and one that’s been around for a while—it’s generally best to keep the older card open before applying for a mortgage. Closing it could negatively impact the credit score benefits it provides.

See the Should I cancel? section of our Credit scores guide for full information on why you should (and shouldn’t) close old accounts. Remembered, if you are closing an account, just cutting up the card isn’t good enough – you must tell the bank you want it closed.

8 – Always pay ALL your bills on time

It’s clear but crucial: every missed payment affects your credit report, making it essential to stay current with all your financial obligations.

A single missed payment can impact your credit score for a minimum of one year and remain on your credit report for up to six years. Even neglecting one mobile phone payment could jeopardize your chances of securing a mortgage.

Moreover, if you’re seeking a mortgage from a lender with whom you have a history of missed payments, your application might face additional hurdles. Lenders are likely to be cautious, and you may need to provide a strong rationale for any past payment issues.

To avoid these problems, consider setting up direct debits to ensure all payments are made punctually.

9 – Don’t apply for other credit shortly before a mortgage

To improve your chances of securing a mortgage, it’s wise to refrain from applying for any new credit in the three months leading up to your mortgage application, as this could negatively impact your credit score and lead to a rejection. For added security, some experts suggest waiting at least six months. You can find comprehensive details in the Credit Scores guide.

Lenders will review your credit report each time you apply for a loan, credit card, overdraft, or even a mobile phone or utility contract. This review, known as a ‘hard’ credit check, is recorded on your credit file even if you do not proceed with the application.

Frequent credit inquiries within a short period can decrease your likelihood of obtaining credit, as it may appear that you are urgently seeking funds.

If you must apply for credit, a single application is unlikely to significantly harm your credit profile, provided it is manageable. However, if you’re considering a payday loan, be cautious—some mortgage lenders may reject your application if you’ve had a payday loan within the past year.

Research indicates that 20% of first-time homebuyers who faced mortgage rejection did so because of a previous payday loan. For further information, refer to our Payday Loans guide.

10 – Boost how ‘affordable’ you look to lenders

Lenders will evaluate your financial capacity, and these evaluations have become more detailed over time. As part of this process, they will likely request to review your bank statements.

One key reason for this is that mortgage lenders must ‘stress test’ applicants. This involves assessing whether you could still manage your mortgage payments if interest rates were to rise. Stress testing is crucial in determining your overall ‘affordability’ and whether you qualify for a mortgage.

Typically, lenders will request at least your most recent three months of bank statements to verify that your income aligns with what’s listed on your payslips, and to scrutinize your recent spending patterns. They will also check to ensure you haven’t omitted any expenses, such as tuition fees or ongoing credit repayments. If there are discrepancies, the lender might seek clarification, which could delay your mortgage application.

For more details on how lenders evaluate affordability and to estimate how much you might be able to borrow, refer to our guide, “How much can I borrow?”

Given the rigorous affordability assessments, it’s wise to start budgeting carefully in the months leading up to your application. Since moving expenses can be substantial, saving as much as possible can help you manage unexpected costs and improve your financial profile in the eyes of lenders. For advice on budgeting and adhering to a spending plan, check out our guide on “How to budget.”

Will lenders consider how many subscription services I’m signed up to?

Netflix, Disney+, Spotify—there are numerous subscription and streaming services available today. It’s not surprising that many individuals subscribe to several of these services simultaneously.

However, the costs can quickly add up, and mortgage lenders will certainly take into account how much you’re spending on subscriptions each month when determining what they believe you can afford. High spending on these services could significantly influence the amount a lender is willing to allow you to borrow.

Simply stating that you plan to cancel a subscription may not be sufficient, as lenders are aware that some services lock you into contracts, and many subscriptions are easy to reinstate. Therefore, if you’re considering canceling subscriptions to demonstrate your financial viability, it’s advisable to do so several months before applying for a mortgage.

For more details on how to identify and eliminate unnecessary direct debits, standing orders, and recurring payments—which could help improve the amount a mortgage lender is willing to lend—refer to our Direct Debit Audit guide.

11 – Stay out of your overdraft

If you frequently find yourself relying on your overdraft, it might indicate that you’re managing your finances too tightly, so it’s best to steer clear of it whenever possible. Some lenders may even disapprove if you’ve been using your overdraft during the past three months.

Moreover, if you’re forced to rely on your overdraft, it raises the question: Are you truly in a position to take on a mortgage?

If an overdraft is absolutely necessary, consider finding a more affordable option by checking out our Best Bank Accounts guide. However, make sure to plan for paying off the debt as quickly as you can.

12 – Be mindful of what appears about you online (on search engines, social media etc)

In today’s digital era, where mortgage lenders increasingly rely on online checks and verifications, it’s crucial to be mindful of what might surface in searches on platforms like Google, Facebook, LinkedIn, and others.

Be cautious about any social media content that could cast you in a negative light. For instance, posts bragging about tax evasion, involvement in criminal activities, political controversies, or any other negative publicity could make lenders uneasy.

Remember, mortgage lenders are concerned not only with your ability to repay the loan but also with avoiding any reputational risks associated with their clients. One mortgage broker mentioned that red flags often emerge from a simple Google search, so it’s wise to be vigilant.

If you own a business, lenders are also likely to check online to verify that your business is active and performing well.

13 – Make paying your rent boost your credit rating

Do you consistently pay your rent on time? If so, there are programs available for both private renters and social housing tenants that can help enhance your credit score.

Usually, you need to be enrolled in these programs for at least a few weeks before your rent payments begin to reflect on your credit report. However, the longer you remain in the program, the more positive impact timely rent payments can have on your credit score.

Some participants in these programs have reported noticeable improvements in their credit scores. However, it’s difficult to determine an average increase, as it largely depends on individual circumstances.

Keep in mind that to potentially benefit from these schemes, you must consistently pay your rent on time. Missing a payment could be recorded on your credit report and might deter lenders when you apply for a mortgage.

For more information, explore our Credit Scores guide.

14 – Put £100 more than you have to on your deposit – it can ease acceptance and boost how much you’re able to borrow

It’s widely recognized that mortgages tend to become more affordable when you reach certain loan-to-value thresholds, such as 90%, 80%, 75%, and 60%. In other words, if you can manage a 10%, 20%, 25%, or 40% deposit, you’ll likely secure a better deal. Therefore, if you’re close to one of these thresholds, it’s worth exploring whether you can stretch to reach it, as this could lower the interest rate you’ll have to pay.

For instance, you would generally secure a significantly better interest rate by applying for an 80% mortgage with a 20% deposit compared to an 81% mortgage with a 19% deposit. For further details on why your loan-to-value ratio matters and how much you could save with a larger deposit, refer to our How much can I borrow? guide.

What is less commonly known are the two potential advantages of pushing just £100 or so beyond a specific threshold (for instance, just below a 90% or 80% mortgage). These include:

• It can increase your chances of mortgage acceptance. This is because it no longer looks to mortgage underwriters like you’re scraping to get to the mortgage band limit.
• It can impact how big a mortgage your lender is willing to offer you. For example, 4.75x your income, rather than 4.5x.

A mortgage broker, explains that even a small increase in your deposit, such as an additional five pounds, can sometimes make a significant difference. This is especially true for high loan-to-value mortgages (like 95% or 90%) or when dealing with larger lenders, who often use computer algorithms to process mortgage applications. It’s also relevant when your credit report is borderline.

Since it can’t hurt, it’s worth giving it a try.

15 – Sort your paperwork to speed things up

Before lenders can offer you a mortgage, they require verification of your income. Therefore, it’s advisable to organize your financial documents ahead of time. Submitting all the necessary paperwork at once can accelerate the process, as it minimizes the likelihood of multiple people needing to review your application.

If your lender does not accept PDFs, digital uploads, or printed bank statements, you might need to request original copies from your bank(s). It’s a good idea to request these several weeks in advance to account for any delays in receiving the originals.

Your lender may want to see any or all of:

• Your last three months’ bank statements
• Your last three months’ payslips
• Proof of bonuses/commission
• Your latest P60 tax form (showing income and tax paid from each tax year)
• Your last three years’ accounts or tax returns
• Proof of deposits (savings account statements)
• ID documents (usually a passport)
• Proof of address (utility bills or credit card bills, for example)
• A gift letter. If you’re getting deposit help, the lender needs to know it is a gift (not a loan), and that the giver won’t part own the home.

Get paid in cash and/or regularly make cash deposits?

Frequent cash deposits into your bank account can raise concerns for mortgage lenders, even if that’s how you receive your salary.

Lenders need to verify that the source of cash deposits is legitimate. If you regularly deposit cash, it’s important to be prepared with an explanation or supporting documentation, such as a letter from your employer stating that you are paid in cash. It’s easier to reassure a lender if these deposits are consistent in amount and occur on a regular schedule. Additionally, lenders will want to ensure that any cash income has been properly taxed.

If this situation applies to you, consulting with a mortgage broker is a wise step. They can connect you with a lender who is more accommodating to cash-paid income.

16 – Avoid delays – fill out the application form correctly

Here are our five best tips for completing paperwork or an online application. Even if you eventually hire a broker to assist you, it’s common for you to be asked to review it first, so be sure to:

+ DO state your income exactly. Don’t round up.

+ DO give your FULL NAME – even middle names are necessary.

+ DO declare ALL your debts. The lender will find them anyway and withholding the info can mean a quick decline.

+ DO get your three-year address history exactly right, including postcodes.

+ DO give honest answers when asked about how much you spend.

17 – Test drive your mortgage chances

After following all the steps outlined above, your financial situation should be in excellent condition. To confirm this, obtaining an Agreement in Principle (AIP) from a mortgage lender can serve as a crucial indicator.

An AIP is a provisional offer indicating that you may be eligible for a mortgage based on a brief review of your income and, likely, your credit history. While it’s not a binding commitment and isn’t mandatory, having one can be particularly advantageous for first-time homebuyers. It can increase the confidence of estate agents or sellers in your ability to complete the purchase, thus improving your chances of having an offer accepted. Some cautious sellers may even require proof of an AIP before allowing property viewings.

It’s advisable to compare the best available mortgage deals using a tool like our Mortgage Best Buys. Then, consult with the lender (or your broker) to see if you meet the criteria for their AIP. Remember, an AIP doesn’t obligate the lender to offer you a mortgage, nor does it commit you to borrow from them if you find a better deal later on.

Be cautious – having numerous credit checks in a brief period can negatively impact your credit score if lenders record these inquiries on your credit report. This may affect your mortgage application adversely down the line.

Certain lenders provide a ‘soft’ inquiry option, which remains invisible to other lenders but will be visible to you. Make sure to clarify with the lender which type of check they perform before proceeding.

18 – Rejected? Stop before you make another move

If you’re rejected – FREEZE! Don’t automatically apply again with a different lender. Too many applications will mess up your credit score, so don’t do it. Instead, the first thing to do is to check your credit file again. Could you have missed something?

At all costs, avoid the rejection spiral. The nightmare example works like this:

• You apply
• You get rejected (sometimes falsely, due to an error)
• You apply elsewhere
• You get rejected again

This continues, until finally you check your files and get the error corrected. So…

• You apply again
• You’re rejected because of recent ‘searches’

If your application is rejected, revisit the beginning of this guide and adhere to the outlined steps. This is crucial, as additional applications can lead to multiple credit inquiries, potentially worsening your situation.

Assuming your credit file is in order and you haven’t overlooked any details, the rejection might be due to specific criteria set by the lender. It’s a good idea to ask the lender directly for the reason behind the denial.

This inquiry should clarify the primary cause of your rejection and confirm whether it was related to your credit file.

Ready to get a mortgage?

• Mortgage Best Buys: Find your top mortgage deals.
• Cheap mortgage finding: How to pick a broker.
• First-time buyers’ guide: Free PDF guide.
• Remortgage guide: Free PDF guide.