Seven tips to get your mortgage application approved

Are you planning to apply for a mortgage in the near future?

If so, there are steps you can take in advance to increase your chances of getting a YES from the bank.

  1. Practice good account conduct. Avoid going into overdraft by accident. This happens when an automatic payment is slightly more than the amount available in your bank account. While this may not involve a large amount of money, it can serve as a red flag for the bank and it can affect your chances of being approved for a mortgage later on.
  2. Avoid short term debt on consumer goods like TV’s, sound systems, expensive cars. If you can’t afford to pay cash right now, consider whether you should be buying it. Things that are on deferred payment really do matter in the eyes of the bank. Even if the weekly amounts going out are small. Avoid deferred payment plans if at all possible.
  3. Income is everything. Most banks will value regular income over a sizeable savings account. Even though a healthy savings balance potentially puts you in a better position to be able to pay your mortgage on time. Having lots of cash in the bank is great but it doesn’t guarantee the bank will approve you for a mortgage.
  4. Don’t go on holiday if it’s all going on the credit card. Banks will potentially scour your spending records and look for red flags like excessive credit card spending.
  5. Job stability helps. The longer you have been with your employer, the better. Keep that in mind if you are thinking of becoming a contractor, or have a scattered job history and are thinking about making another move.
  6. For self-employed people, taxable income is what matters. Banks are looking at your income AFTER your expenses so keep that in mind when you are deciding what to claim.
  7. Consider using a mortgage adviser. They deal with multiple banks on your behalf, helping you find the option which is best for you. They know how to present your case to each bank which can increase your chances of securing an approval. Above all, they are on your side and are there to guide you through the process.

Get in touch if you are thinking about making a move in the near future and we can put you in touch with our recommended mortgage adviser. Once you have your finance sorted, we can help you find a new home and provide advice on getting your current property ready to sell.

28786-1624485405-hMljciQn0KzEV1cXaDuwaYWql3fHmMw5

Tony Skilling

Licensed Real Estate Salesperson, REA 2008
Arizto New Plymouth
Mobile: 020 486 6975

Smarter Real Estate has arrived in New Plymouth

$10,000+GST commission
Based on New Plymouth’s median sale price, most traditional real estate agencies charge around $22,028. It comes as no surprise that sellers are unhappy paying such high commissions, and we agree it’s unnecessary. Arizto found flaws in the way traditional real estate is performed and created a better solution for Kiwis.

Related Articles

Tony Skilling © 2021 • New Plymouth Real Estate Salesperson with Arizto

Licensed REA 2008