Mortgage: Britons have been warned about ‘what not to do’ since agreements may be jeopardized.
NOT ONLY FOR FIRST-TIME BUYERS, but also for candidates farther down the line, obtaining a mortgage is a critical goal. However, there are some activities that could jeopardize an agreement.
Because a mortgage is such a large financial commitment, lenders will check into a person’s stability and capacity to make payments. Many people, on the other hand, are oblivious of the little financial blunders they may be making that could jeopardize their application. Thankfully, Karina Hutchins, the CEO of Home by OpenMoney, has offered some helpful hints for making a flawless mortgage application.
The cost of daycare, which may quickly add up, is one of the most significant factors to consider.
Ms Hutchins described the fees as “extortionate,” and the expert advised that anyone searching for a mortgage take a close look at the situation.
She suggested that people take advantage of government or workplace childcare subsidies to avoid putting a dent in their income.
Indeed, with the pandemic allowing many individuals to work from home, this could be a cost-effective alternative to a potentially costly endeavor.
Another facet of life that might have an impact on a person’s money is the growing popularity of Buy Now Pay Later (BNPL) schemes.
While these can be beneficial in spreading costs, many people do not see them as debt and are thus caught off guard when it comes to dealing with a mortgage.
Ms Hutchins added that advice varies by institution, but there have been cases where purchasers’ applications have been rejected because of these programs, which appear on bank statements.
“It can give the idea that you’re ‘living above your means,’ which can be a concern for any lender,” she continued.
However, another factor to consider is the use of credit cards versus debit cards, which can have a significant impact on how someone is seen.
“Surprisingly, for many lenders, it is preferable to have debt on a credit card and fulfill the minimum payment obligations each month than to live in your overdraft,” Ms Hutchins stated.
“If your overdraft is greater than your pay and you’re continuously ‘in the red,’ your application may be rejected.
“However, if you have the same amount,” Brinkwire Summary News says.