Mortgage Application Approval: What to Expect and How to Speed Up the Process
Applying for a mortgage is a significant step in your home-buying journey, and one of the most common concerns is how long it takes to get a mortgage application approved.
The timeline can vary depending on several factors, including the complexity of your financial situation, the lender’s workload, and the efficiency of the communication between all parties involved.
At Kerr & Watson, we understand how important it is for you to secure your mortgage approval as quickly and smoothly as possible. I
Here, we’ll explore the various stages of the mortgage application process, the factors that can influence the approval time, and how our expert advice can help you to speed up the process.
Understanding the Mortgage Application Process
The mortgage application process typically involves several key stages, each with its own timeline. Understanding these stages can help you manage your expectations and ensure you’re prepared for each step.
Getting a Mortgage Agreement in Principle (Timeline: 1-2 days)
A Mortgage Agreement in Principle (AIP), sometimes referred to as a Decision in Principle (DIP), is the first step in the mortgage application process. This is not a full mortgage offer, but it does give you an indication of how much you can borrow based on an initial assessment of your financial situation.
Getting an AIP can less than 24 hours, provided you have all the necessary documentation ready, such as proof of income and a good credit history, and it does not get referred or declined.
While an AIP isn’t a guarantee of a mortgage, it can make you a more attractive buyer to estate agents and sellers, as it shows you’re serious and should be financially capable of purchasing a property.
Submitting a Full Mortgage Application (Timeline: Estimate 1-2 hours)
Once you have an offer accepted on a property, the next step is to submit a full mortgage application. This involves providing detailed information about your finances, including payslips, bank statements, and proof of deposit. If you’re self-employed, you’ll need to supply additional documents, such as tax returns or business accounts.
The actual submission of the application can take just a few days. If you’re well-prepared.
And using a mortgage broker like Kerr & Watson, this process can be quicker, as we handle much of the paperwork and ensure everything is in order before submission.
Mortgage Valuation and Property Survey (Timeline: Estimate 1-2 weeks)
After submitting your application, the lender will arrange for a property valuation. This is to ensure the property is worth the amount you’re borrowing and is sound collateral for the lender to secure their funds to.
The valuation is usually carried out by an independent surveyor and may take up to two weeks to complete, depending on the surveyor’s availability and the property’s location. There are different types of surveys, here you can find the difference.
The results of this valuation are crucial for the approval process. If the property is valued at less than the purchase price, the lender might offer a lower loan amount, or the application could be delayed as you negotiate with the seller.
Mortgage Offer Issued (Timeline: Estimate 2-4 weeks)
Once the valuation is complete and the lender is satisfied with your financial situation, they will issue a formal mortgage offer. This is the point where you can start to breathe a little easier, knowing that the funds will be available for your property purchase.
Receiving a mortgage offer can take anywhere from about two to four weeks after submitting your full application. This timeframe can vary based on factors such as the lender’s current workload, the complexity of your application, and whether any additional information is required.
This may even be quicker with some lenders in as little as a week but each transaction really is different. Here you can find out what happens after mortgage offer.
Find out Your Options
Factors That Affect Mortgage Approval Time
Several factors can influence how long it takes to get a mortgage application approved. Being aware of these can help you anticipate potential delays and take steps to mitigate them.
Your Financial Situation
The more straightforward your financial situation, the quicker the approval process is likely to be. If you have a stable income, a good credit score, and a clear financial history, your application is more likely to go through without significant issues.
On the other hand, if you’re self-employed, have multiple income streams, or have a complex credit history, the lender may require more time to assess your application. It may also take the broker longer to place the mortgage if they need to call around to run the case by the lenders, sometimes for a policy exception.
The Lender’s Workload
The time of year and the lender’s current workload can also affect how quickly your mortgage application is processed. For example, lenders might be busier during peak times in the property market, such as spring and early summer, which could lead to longer processing times.
Documentation and Communication
Delays in providing the necessary documentation or responding to requests from the lender can significantly slow down the process. It’s essential to have all your paperwork ready before you start your application and to respond promptly to any queries from the lender or your mortgage broker.
Property Valuation Issues
If the property valuation comes back lower than expected, or with questions from the surveyor, this can delay your mortgage approval. You may need to renegotiate the purchase price with the seller or provide a larger deposit to bridge the gap if it’s down valued, both of which can add time to the process.
Conclusion
The time it takes to get a mortgage application approved can vary by a large amount, as every transaction is unique, but with the right preparation, this should increase your chances for a quicker process.
At Kerr & Watson, we’re here to support you every step of the way, ensuring your mortgage application is handled with the utmost care. Get in touch for independent mortgage advice today.
