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Getting approved for a mortgage can be challenging, but there are steps you can take to boost your chances.
Here, we reveal 10 things that could affect the likelihood of you securing a mortgage, and offer tips on how to overcome them.
Hate to be the bearer of bad news but more than likely they will decline your mortgage. Most if not all will decline with even a sniff of gambling on statements unfortunately. I had to use the Halifax as they at they dont ask for bank statements. Could be an idea for you unless their policies have changed. Professional gambling, by its nature, can be an up and down experience and if the question is, does gambling affect mortgage applications? Then the short answer is, ‘maybe’. Income can be irregular, unreliable, short one month, and large the next, depending on performance and which particular events/activity is carried out. ONLINE gambling and evidence on your credit card statements of paying Paddy Power and other internet bookies is a 'red flag' that may stop you getting a mortgage, the Sunday Independent has learned.
1) Having large amounts of outstanding debt
Generally speaking, it is possible to get a mortgage with credit card debt.
Lenders may be reluctant to grant you a mortgage, however, if you have large amounts of outstanding debt from personal loans and credit cards.
This is because having to pay off other loans will directly impact how much (and whether) you can afford your mortgage repayments each month.
For this reason, it’s really important to pay down as much debt as possible before making a mortgage application.
While your student loan will not be considered the same as other forms of debt, your lender may take it into account when working out whether or not you can afford to take out a loan. Read will my student loan affect my mortgage? to find out more.
2) Having a bad credit score
If you’ve got a bad credit history, County Court Judgements (CCJs), or a bankruptcy on your record it can be really difficult to get approved for a mortgage.
This is because lenders use your credit history to judge your ability to stay on stop of debt.
Missing or making late payments on a previous mortgage, loan, credit card or even your mobile phone bill could potentially scupper your chances of being accepted for a mortgage.
All hope isn’t lost if you have an adverse credit history though, as it may be possible to get approved for a bad credit mortgage.
However, rates on bad credit mortgages can be high, so it may be better to spend time improving your credit score and then applying for a regular mortgage.
3) Having no credit history at all
Applying for a loan with limited or no credit history is a bit like applying for a job without a CV.
Since your credit score lets lenders know how reliable you are at making repayments and handling your debt, you’ll need to have some form of history to be approved for such a large loan.
It’s important to check your credit score before applying for a loan and, where possible, take steps to build up a good credit score before making a mortgage application.
4) Not being on the electoral roll
The electoral roll allows lenders to verify your identity quickly. Not being registered will make it difficult for a lender to confirm who you are.
This could slow down the mortgage application process, as your lender will probably request additional identification checks, and it could even result in your application being rejected altogether.
The good news? Getting on the electoral roll couldn’t be simpler; all you have to do is fill out a form using the register to vote service on Gov.uk.
5) Buying a ‘non-standard’ property
The type of property you’re looking to buy could affect the success of your mortgage application.
Ex-local authority housing, for example, can be appealing as these types of home are often cheaper than others on the open market. Most lenders, however, are reluctant to grant mortgages on this type of property as they are considered more likely to lose value over time.
Similarly, you may find it difficult to get a mortgage for a flat above commercial premises like shops, pubs or restaurants, as they are at a greater risk of being affected by things like noises, smells, rubbish and security issues, which can also bring down the value of the property.
For more information check out our story, 16 properties to avoid if you want to get a mortgage.
6) Trying to borrow too much money
It’s important to do the maths and be realistic about how much money you can afford to borrow.
Typically, mortgage lenders will only lend a maximum of four-and-a-half times the combined annual income of you and anyone else you’re buying with. Asking for a loan above this threshold will likely result in your application be rejected – and you may well find that you’re offered less than the maximum.
- Find out more: how much mortgage can I borrow?
7) Being self-employed
Mortgage providers can be reluctant to approve a loan to self-employed workers.
This is because, without a contract of employment or regular payslips, it can be difficult to prove that you’ll be able to keep up with mortgage repayments.
If you’re self-employed and are hoping to buy a home, it’s vital to compile documents proving your past income and future opportunities for payment. Most lenders will want to see at least two years’ worth of accounts.
- Find out more: mortgages for self-employed buyers
8) Major lifestyle changes
Going through major lifestyle changes that could affect your finances, such as starting a family or going through a divorce, could negatively affect your mortgage chances.
Some lenders may partly base their decision on whether and how much to lend you on childcare fees, for example. Find out more in does having children ruin your mortgage chances?
Similarly, if you are expecting a child and going on maternity leave at the time of applying for a mortgage, lenders may be wary of how much you’ll be able to afford if you’re expecting a decrease in income. Read our guide on getting your mortgage when pregnant for more information.
And if you’re hoping to get a mortgage after getting divorced, it’s important to re-evaluate your financial circumstances, especially if you’re buying alone. Our guide on selling a house in a divorce shares everything you need to know about securing a new home.
9) Errors on your application
Lenders scrutinise every mortgage application with a close lens, so it’s really important to make sure all of the information you give your lender is correct and up-to-date.
Any discrepancies or inaccuracies on your application could not only slow down the loan process, it could also result in your loan being turned down altogether.
- Find out more: how to improve your mortgage chances
10) Applying to the wrong lender
So your finances are in great order, your credit score is impeccable; everything should be smooth sailing, right? Not always.
Each lender will have its own affordability criteria and may place more weight on certain factors. For example, while some lenders may be more willing to accept applications from households with growing families or self-employed applicants, others may have more rigid criteria.
It’s important to find the lender most likely to accept your financial and personal circumstances the way they are – and this is where the expertise of a mortgage broker can really help.
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Speak to the experts
Whether you’re a first-time buyer or home mover, applying for a mortgage can be a stressful and daunting prospect.
Speaking to a mortgage broker can not only help you find the best mortgage deals, but also find the most suitable lenders for your personal and financial circumstances.
Generally speaking, gambling and mortgages do not mix well. Taking out a mortgage means that a bank or building society trusts that you’re able to pay the money back. But if they see that you’re an active gambler, then this may go against your application.
However, there is a difference between those who gamble large amounts of money on a regular basis (including those who are professional gamblers), compared to those who might put a small bet on every now and then.
When will gambling affect a mortgage application?
If you’re a professional gambler wanting to use your winnings as evidence that you can afford to take out a mortgage, then you might come up against a few hurdles, as this is considered far more risky than someone who has a job and gambles occasionally on the side. That’s not to say that it isn’t impossible though. Those lenders who are willing to lend you the money might alleviate this risk by increasing the interest rate and only lending a small amount of money.
Whilst you may argue that professional gambling is no different to getting a mortgage when self-employed, gambling is still deemed as a riskier business than self-employment, especially if there’s no trace of regular savings but a build-up of debt instead.
Ultimately, you need to be aware that if you’re a professional gambler, this activity is seen as a risk and could result in your mortgage being declined.
When won’t gambling affect a mortgage application?
Does Gambling Affect Mortgage Uk
When lenders carry out their affordability checks, they look at your bank statements from the previous 3-6 months. Therefore, any gambling on your bank statements during this period will be seen by your potential lender. However, the lender is not going to judge you on what you chose to spend your money on. Their primary concern is that you aren’t getting into debt in order to fund the gambling, so if you’re betting using your own money, and you aren’t in debt, then this shouldn’t affect your mortgage application.
Similarly, if you only put the odd bet on here and there, then you don’t need to worry about gambling affecting your mortgage application. Just be mindful that if your finances begin to suffer because of it, then this may affect things.
How to get mortgage approved
If you do gamble and you’re worried about getting a mortgage, you could try the following things to help improve your situation and get yourself mortgage ready:
Clear your debts – Clearing off any debt you have shows that you’re responsible when it comes to your finances.
Regular savings – Again, it’s all about responsible lending, so if you can show that you have a savings account that you pay into regularly, the lender will see you as a low-risk borrower.
Good credit history– Having a good credit history improves your chances of getting a mortgage, so you should work to improve your credit score.
Stop gambling – The most obvious, but this can only happen if you want to stop gambling.
Get the right mortgage advice
Speaking to a mortgage broker can help you get the right advice that you need in order to fulfil your dream of getting on the property ladder. They’ll be able to address any worries or concerns that you may have about your spending habits.
Does Gambling Affect Mortgage Application Uk Gov
At Mortgage Advice Bureau, we deal with people from all walks of life and we do not judge anyone’s personal circumstances – we are simply here to help.
Get help for your gambling addiction
If you’ve been refused a mortgage due to gambling, then now might be the right time to turn things around and seek advice. Visit the GambleAware website for help with a gambling addiction https://about.gambleaware.org/.
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For further information call: Sunjay Chauhan 07525 129333
Email: [email protected]
or visit: Sunjay Chauhan Website
Your home may be repossessed if you do not keep up repayments on your mortgage.
There will be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1.5% but a typical fee is 0.3% of the amount borrowed.
Does Gambling Affect Mortgage Application Uk Online
Having been in the mortgage industry for over 10 years I have a wealth of knowledge in all things related to mortgages. I pride myself on providing the highest level of service to all my clients which has led to me winning a number of awards.