Getting a mortgage: 9 best mortgages and savings tips for first time house buyers - according to an expert

• Home ownership and securing a mortgage seems to be becoming increasingly difficult
• First-time buyers need to manage their finances as a lender would expect before granting a loan
• Jo Pocklington, Managing Director of Purplebricks Mortgages, provides advice based on her 23 years of experience
• She highlights several common mistakes to avoid
• Pocklington recommends actions like closing outdated bank accounts to improve mortgage approval chances

Getting onto the property ladder is challenging at the best of times, but with volatile interest rates, a shortage of affordable housing, and the cost-of-living crisis, home ownership can seem out of reach for many.

To give yourself a better chance of securing a mortgage, many experts recommend being ‘mortgage ready’, which involves buyers taking a hard look at their financial management, as a lender might before granting a loan of hundreds of thousands of pounds.

Jo Pocklington, Managing Director of Purplebricks Mortgages, has 23 years of experience helping hopeful buyers secure their dream homes. She says that while there are several steps house-hunters should take when applying for a mortgage, there are also crucial mistakes they must avoid.

Here are Jo’s nine potential pitfalls for prospective homeowners:

Get serious!

Jo says: “Sometimes it can be the most trivial of things that wrecks a mortgage application. We have all done it, transferred cash to a friend or family member. How many times have you been tempted to put something silly or amusing as the reference?

““But be warned. A few quid transferred from a friend’s account for a meal out could see you face some difficult questions, if that friend had sent it with a joke reference to illegal activity.

“A joke reference about drugs or tax avoidance could easily be misconstrued by a lender, and scupper your application.”

Behave yourself!

“You will need to prove you can afford your mortgage if interest rates increase beyond what they currently are. To do this, most lenders will check your last three months worth of bank statements to ensure you are living within your means.

“Make sure you are paying your bills on time - a late payment can sit on your credit history for six years - and that you’re not going on too many online betting sprees.

“Contrary to common belief, subscriptions to Netflix or Amazon Prime can actually be helpful to an application because they show you have been able to keep up with regular payments.”.

Don’t be limited by the standard length mortgage

“The longer the term, the lower the monthly payment. Many mortgage providers will allow loans to run up to the age of 75 - so can look into spreading payments over 40 years, depending on your ability to repay it over the longer term and how much you can afford.

“Longer term mortgages aren’t suitable for everyone, so getting good quality advice is key on this. And remember - increasing the term means you'll pay more interest on the mortgage in the long run.”

Close down out of date bank accounts

“Dormant bank accounts prove a pitfall for many applicants. Leaving them open can leave you vulnerable to fraud, and/or keep out-of-date information about where you live. While a poor credit score doesn’t rule you out for a mortgage, it can certainly reduce your chances.

“To maximise your options, spend some time getting your credit history in its best shape possible.

“Close any out of date bank accounts, ensure there are no outstanding bills or unpaid fines and limit use of credit companies like Klarna, which can be a real red flag for mortgage companies, who may view it as a sign you’re unable to pay an invoice immediately.”

Don’t get left out of the system

“This might seem a no-brainer, but I’ve seen plenty of applications fall down because the applicant wasn’t registered on the electoral register. And it’s such an easy thing to fix.

“You can have a perfect credit report without being on the electoral roll, but it's very difficult to get a mortgage without being registered.”

Avoid overspending

“By this I mean stay within your overdraft. Lenders need to know you are living comfortably, before you add the burden of a mortgage into the mix. If you are permanently in your overdraft, perhaps you shouldn’t be applying for a mortgage at all.”

Limit your credit applications

“Do not do multiple credit applications - do a soft search before applying to see if you are eligible. And, if you’re turned down, find out why before applying elsewhere.

“Too many applications will ruin your credit score, so just don't do it. Instead, the first thing to do is to check your credit file again. Could you have missed something?

“Perhaps you rushed your answers and there is something incorrectly answered, or you might have an outstanding debt, that you could settle and clear your name or maybe you need to redo the sums and calculate your maximum borrowing amount again.”

Don’t just fix on going it alone

“Clubbing together with a friend or family member could both increase the amount of money available, and help when it comes to bill sharing.

“You’ll need to really hammer out an agreement between you, to ensure trust, and think the whole thing through, including what will happen down the line when one party may wish to sell. I’d recommend getting legal advice before going down this avenue.”

Don’t give up, if you can’t get a standard credit card

“If you have or are struggling to get a credit card, because of a poor rating, there are other ways.

“Get yourself a Credit Builder card - they have lower limits, higher interest rates, and fewer benefits than other credit cards, but they will allow you to build - or rebuild - your credit rating if used sensibly and get your credit score back on track!”

Have you encountered any of these mortgage pitfalls or found other effective strategies to secure a home loan? Share your insights, tips and questions in the comments section.