Statistically there are two major culprits when it comes to deals falling through – mortgage problems and legal delays.
Here are some tips to improve your chances of success by speeding up your mortgage (the following blog covers legal delays) .
GETTING A QUICKER MORTGAGE OFFER
Unless you’re a cash buyer, you can’t exchange contracts without having received a formal mortgage offer – because if you just went ahead and then couldn’t lay your hands on the money to pay for the house, you’d be liable to pay out considerable sums in damages (as well as looking a bit of a plonker). So it’s essential to receive your mortgage offer in good time. There are a number of ways you can speed this along:
* Pick an efficient mortgage lender
A really switched-on bank can produce your mortgage offer within a couple of weeks. A dozy one could take a month or more. So it pays to choose your lender carefully, and ask them what their average turn-around time is. Brokers know which ones are hot and which are not, plus they can help chase things when the going gets slow. It’s also worth making it clear to your lender from the outset that yours is an urgent case.
* Apply early for your mortgage
With some lenders you can apply in principle for a mortgage even before you’ve found a property to buy. This means they can make an early start writing for employment references and doing credit scoring. Applying early can also buy time should the lender insist that you need to arrange a new life assurance policy as a condition of giving you a mortgage. In such cases a bank’s underwriters sometimes require medical reports, which can take weeks to resolve – better to know this now than the week before exchange. It’s also important to be very clear at the outset what costs are involved in your purchase so that you have sufficient funds available in time – double check legal fees, stamp duty and all those sneaky hidden mortgage charges.
* Get the mortgage valuation done early
Lenders normally wait until they’ve received income references and completed credit checks before instructing the mortgage valuation. This is a sensible precaution because, were there to be a serious income or credit problem and the mortgage refused, you wouldn’t have wasted money paying unnecessarily for the bank’s mortgage valuation. But if you’re confident that your financial standing in the community is bullet-proof, ask the bank to instruct their valuer asap – obviously this will be at your risk.
* Alert your employer
One common reason for hold-ups is employers being unbelievably slow replying to income reference requests. Most banks will not accept a simple letter alone, and need their forms correctly completed. So if your employer fails to read the form properly and does it wrong, it will have to be resubmitted. It can therefore pay to pre-empt such tomfoolery by finding out in advance who it is in your organisation that will be dealing with your income reference. Then give them a call to keep tabs on progress.
* Get chasing
If you don’t hear anything, never assume that everything’s going smoothly. Pick up the phone to your lender and regularly check progress of each stage as if your life depended on it. Keep phoning and emailing until you’re officially known as Pain In The Arse Number One. This gets results.
Other things you can do to smooth the path of your all-important mortgage offer include making sure the property you’re buying is acceptable to your lender. This is relevant when it’s of unusual construction or a quirky design, such as a flat in a tower block, or a property with concrete walls. It also helps to choose a surveyor who can turn reports around super-quick.
Our next blog – tells you how to improve your chances of success by speeding up the legal work
Consider all of the above and your chances of success will get a huge boost. Check out our blog page for more industry tips and secrets!