Mortgage Blog: Getting your documentation ready
Stephen Dwelley, Director of Share to Buy, brings you his latest Mortgage blog!
In this edition, Stephen looks at what documentation you can get ready in advance of your mortgage application to ensure as speedy a process as possible when you come to apply. Don’t forget, Share to Buy has a team of experienced Mortgage Brokers available to help you find a mortgage for your Shared Ownership home. To compare Shared Ownership mortgages online, you can use our comparison tool.
While you are looking for a suitable property and going to viewings, there is one task that you can sensibly start, so that when you have been offered a property, your mortgage application is not delayed. All mortgage applications will require that you provide documents as part of the process so start getting your documentation ready as follows:
This is used as proof of identity. It must be current, so if yours has expired get it renewed as only a current passport will be accepted.
This can be used as proof of identity or proof of address, but not both. Again it must be valid and show your current address. If it is showing your previous address, even if you regard your current address as short term, get it updated.
Obtain a copy, preferably from Equifax or Experian, which are most used by mortgage lenders. This should show all your addresses over the last three years, if any of these are shown incorrectly, then contact the credit agency and get them corrected.
If you are monthly paid then the last three months will be required
If you are weekly paid then the last thirteen weeks will be needed.
If you are including a bonus as part of your pay and this is not guaranteed then this will need to be evidenced. If this bonus is paid monthly then it is still three months’ payslips. However, if this is received annually then the payslip showing the bonus received for the last two years.
This is a form that is issued by your employer at the end of each tax year (April) and show your total income, tax and NI contributions in the past year. Not all mortgage lenders require one but they can be useful to have if there is any query about income history.
Statements of the last full three months will be required. Some lenders will demand postal statements, others will accept internet statements as long as:
- Your name and address are shown
- It contains your account number and sort code
- The bank’s logo
- At the bottom of each page the http address must be showing
It is therefore often worth ordering the postal statements in any event.
At least one, preferably two of the following:
Bank statement from a different account to which your salary is paid into and from within the last three months
Recent utility bill (not mobile phone) dated in the last three months
Council Tax bill for the current year
PAYE coding letter from HMRC for the current year
Benefits award letter
These will be required as proof of address and must show your current address
These are issued by HMRC when your annual tax assessments have been agreed and you will need to produce the last two or three years, including tax calculations, if you are self-employed.
These are really only required if you are an employed director of a company in which you own more than 20% of the shares.
Benefit Award letter
If you are using tax credits as part of your income then you will need the latest award letter.
Last but not least, although you will not be able to obtain this before you have been offered a property the MEMORANDUM OF SALE
This is provided by the housing association and sets out the details of the sale including the rent and service charge, length of the lease. Not all lenders will want this but of you are buying with a 5% or a 10% deposit you will probably need one
Looking for a Shared Ownership mortgage? Share to Buy can help!