Mortgage Application Checklist: What to Do Before You Apply

Navigating a mortgage application can feel daunting. There’s often a lot of waiting and dealing with requests for documents you didn’t know you needed.

It’s often the largest sum of money most people will ever borrow, and the process reflects that: thorough, slow, and full of checks.

Thankfully, a lot of it is front-loaded. And getting all your ducks in a row before you submit anything could simplify the journey.

Here’s what to work through first.

Step 1: Check your credit report

Check your credit report, not just your credit score. It's important to know that your credit score is your own personal reference for how lenders may view you. Lenders make their own lending decisions using the data on your credit report, affordability information, and their internal scoring/underwriting systems, in line with their lending policy.

Check your credit report for:

• Any incorrect personal details. Even a spelling mistake or formatting inconsistency on an address could hinder a credit application.

• Out-of-date information. Keep an eye on any open and closed accounts to make sure everything is accurate.

• Missed or late payments. If you find a late payment that’s been marked as late when it shouldn’t have been, you can contact the lender to put it right.

• Financial associations. You could be financially linked to someone who’s no longer relevant, like a former housemate or partner. Their credit behaviour could influence how you’re seen by lenders – if an association has negative markers on their report, a lender could think you’ll need to help pay back any debt they take on. But if they’re no longer relevant, you could get them removed.   

An issue with any of the above could impact an application. And corrections may take time to work through, so it’s worth looking early – several months before you plan to apply, rather than the week before.

At Checkmyfile, we put all your data from the three main UK credit reference agencies, Experian, Equifax and TransUnion, into one report. Not every lender will report to all three, so one agency’s file could hold information another doesn’t – which matters when you don’t know which agency your lender will use.

Step 2: Confirm your proof of identity and address

Mortgage lenders need to establish who you are and where you're currently living. According to official GOV.UK information, you can expect ID, address and source-of-funds checks at several stages of the application process.

Commonly accepted proof of identity:

• A valid passport.

• UK photocard driving licence.

• Other government-issued identity documents, depending on the lender and immigration/nationality status.

Each lender has its own acceptable-document policy.

Commonly accepted proof of address:

• A bank statement – usually from a different bank than the one you’re applying with, if you’re applying through a bank.

• A utility bill, normally from the last six months.

• A driving licence showing your current address.

• Council tax bills or official HMRC correspondence, depending on the lender.

Documents usually need to be recent, but how recent varies, so it’s worth checking with your lender before you send anything.

Step 3: Gather proof of income

Financial Conduct Authority rules require lenders to obtain evidence of the income you declare. They can’t just take your word for it.

For employed applicants

If you're employed with an ongoing contract, commonly accepted proof of income includes:

• Recent payslips.

• P60.

• Bank statement showing salary payments.

• Evidence of bonuses, overtime or commission, if these are included in affordability.

Most lenders ask for three months of payslips and three to six months of bank statements, though this may vary.

For self-employed applicants

Being self-employed doesn’t stop you from getting a mortgage, though it can mean more paperwork.

Commonly accepted evidence includes:

• Finalised self-employed accounts.

• SA302s, also called tax calculations.

• HMRC tax year overviews.

• Business and personal bank statements.

HMRC holds the last four tax years of calculations in your online account, and most lenders want the SA302 and the matching tax year overview for the same year – one shows what you declared, the other confirms what was charged and paid.

Lenders typically ask for two to three years of accounts and tax information. Again, it varies.

Step 4: Review your financial commitments and expenses

Lenders want to know whether you can afford mortgage repayments based on your income and your expenses, as well as your ongoing financial commitments. It also helps them decide the terms of your mortgage repayments.

You can review your financial commitments and outgoings by looking through your bank statements and credit report and making a note of all of your regular outgoings. Don’t forget things like:

• Phone bill.

• Streaming subscriptions.

• A gym membership.

• Debt repayments.

• Finance agreements, like a car or mobile phone.

• Childcare costs.

• Food costs and other basic quality-of-living costs.

• Essential travel.

• Clothing.

And any other recurring bills or expenses you have.

Note: Lenders don't necessarily judge affordability purely from three months of discretionary spending. FCA rules allow lenders to use actual expenditure, statistical and modelled expenditure or a combination, provided the assumptions are realistic. You don't necessarily need to stop buying your Starbucks for three months before applying for a mortgage.

Step 5: Sort your property and deposit

You usually need a deposit of at least 5% to 10% of the property price, although you can put as much of a deposit down as you can afford as long as it's above 5%. Some 100% mortgages exist, but they are specialist products. The more you put down, the lower your loan-to-value, which usually widens your choice of mortgage and lowers the interest rate you’re offered.

You'll also be asked to show where your deposit came from, for example, accumulated savings, a LISA, the sale of another property, inheritance, or a family gift.

As for the property, the lender will arrange a mortgage valuation. This assesses whether the property gives the lender adequate security for the loan. It isn’t a survey, and it won’t tell you whether the roof needs replacing.

A down valuation – where the lender values the property below the agreed price – can:

• Reduce the maximum mortgage.

• Mean you need a larger deposit.

• Trigger price renegotiations.

• Cause the sale to collapse.

Some properties are harder to mortgage than others, and it’s better to know before you’ve paid for searches and a survey. Lenders tend to be cautious about:

• Unusual or non-standard construction.

• Serious structural condition issues.

• Properties lacking essential facilities, like a working kitchen or bathroom.

• Short or unusual lease terms.

Criteria can vary, so a property one lender won’t touch may be perfectly acceptable to another.

Step 6: Avoid the common reasons mortgage applications fall through

The causes of a sale falling through range from survey findings to broken chains and buyers simply changing their minds.

The mortgage side, though, is the part you have most control over. The usual causes:

• Missed or late payments on your credit report.

• High existing debt.

• Several recent credit applications, or hard searches.

• Errors or inconsistencies on your credit report.

• Defaults, CCJs or other adverse history.

• Affordability that doesn’t support the amount requested.

• Insufficient evidence of income.

• Taking on new credit during the application – a new card, a car on finance, a buy-now-pay-later agreement

• Losing your job or a significant drop in income during the application process. 

You can’t control the survey, the chain, or whether the seller changes their mind. You can take control of your credit health with Checkmyfile and your most detailed credit report.

Prepare for your mortgage application with Checkmyfile

Start ticking off the steps in your mortgage application checklist. With Checkmyfile, you can see your credit information from Experian, Equifax and TransUnion in one place, so you know what a lender will see before they see it. And if you spot something that doesn’t look right, our UK-based customer care team and dispute resolution service are here to help.

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