According to research undertaken by What Mortgage Magazine and Equifax, 48% of people applying for a mortgage are unaware of the regulations introduced in 2014 to check affordability.
The Mortgage https://www.beaconfinancialtraining.co.uk/wp-content/uploads/2020/06/Mortgage-Man-3.jpget Review was introduced to ensure that lenders only approve products which the borrower can afford. Under the new rules, borrowers must prove that they can afford the repayments on a mortgage, not only currently, but also if the interest rates were to increase.
The study also discovered that many people aren’t aware of actions which can damage their credit record, which will have an impact on mortgage applications.
Although 48% of the respondents were aware that issues with credit could have an impact on their mortgage application, only 5% realised that County Court Judgements could also have an impact. Just 3% of respondents knew that a mortgage application could be affected by not being on the electoral roll. Very few people realised that bankruptcy or being a victim of identity fraud could have an adverse impact on a mortgage application, with just 1% being aware.
However, 52% of mortgage applicants had applied for a copy of their credit report prior to making the application, while 17% refrained from doing so, which could impact on their ability to secure a mortgage.
When considering buying a home, it is a good idea to obtain advice from a mortgage adviser, as they have taken a CeMAP course to ensure they have relevant knowledge of the mortgage process.