How to Improve your Credit Score in Harrogate

Mortgage Advice in Harrogate

What is a credit score?

A credit score is a tool that lenders use to measure whether or not an applicant can afford a mortgage or not. The higher your credit score, the more likely it is that you’ll get accepted for a mortgage. Which means that if you have a low credit score, your chances of getting a mortgage are lowered.

Having a high credit score may sound great, however, it doesn’t guarantee you a mortgage in any way. Each lender has their own unique lending criteria and it’s more than likely that you won’t meet all of them. Sometimes it’s down to your circumstances and not just your score.

Matching lender’s criteria

It is more than likely that each lender will have completely different lending criteria. Lenders have almost carved out their own niche market. You could end up matching with lots of lenders or it may only be a couple, but all that matters is that you match with one and get an amazing mortgage deal from it!

Whether you receive help from a Mortgage Broker in Harrogate or go solo and use your bank, it’s their job to help you compare deals and match you with a lender.

As a Mortgage Broker in Harrogate, we would always recommend taking up our free mortgage consultation offer. This way, we can evaluate your situation and compare deals for you straight away. If you go to a bank, you could just be added to a waiting list.

If you are struggling to match a lender’s criteria, it could be down to multiple things or maybe just one. The most common reason why people don’t match their lender’s criteria is that they have a low credit score. If this is your situation, then you need to find some ways to improve your credit score.

Improving your credit score

Avoid unnecessary credit searches

Having unnecessary credit searches on your file could negatively impact your credit score. Lenders don’t particularly like seeing repeated credit checks; they may think that there is a reason behind it and they may even start asking you questions about it. Even using price comparison websites could damage your score.

On another note, if you are applying for a mortgage, it is unwise to apply for any form of extra credit in the meantime of your application.

If you manage to pay back owed money before your application, it will look good on your file, however, if you are borrowing/paying back money during your application, it will have a reverse effect. If you borrow credit, some lenders’ could think that you cannot afford the deposit and are relying on the credit to help you.

Are you registered on the Voter’s Roll?

A great way to improve your credit score is to register onto the Voter’s Roll. Lenders love seeing applicants that are registered on it as it indicates stability. It’s really easy to get yourself registered and the fact that it can boost your credit score surely means that you have to sign up if you haven’t before!

Even if you are already registered, it’s always a good idea to double-check that you have entered all of your information correctly. If you have an old address on their system, lenders will easily spot this mistake and it could go against your score.

Don’t run too close to your maximum limit

Maxing out your card each month will have a detrimental effect on your credit score. If you are using a credit card, a lender would much rather that you pay off the full balance each month rather than cutting it short. Showing you can meet set payments each month shows reliability and can help your chances of being accepted for a mortgage.

On the other hand, if you are doing the opposite and exceeding your credit limits or overdrafts, your lender will think that you don’t take your finances seriously. This could massively impact your credit score, especially if you get declined by a lender due to this reason.

Check that your address is up to date

Your address should always be up-to-date. People usually get caught out when they move out from their parent’s house and forget to update all of their address’.

If you forget to change your address on things such as credit accounts, it will appear that you are living in two separate places. This can hurt your credit score once lenders see this so make sure that you are keeping on top of what address’ are linked with each of your accounts.

Close down your unused credit accounts

If you have any store/credit cards that are no longer in use, you should contact the provider and get them to fully close down your old account(s). These types of accounts are probably doing more damage than you think.

However, if you manage to close your account(s) it could still have a negative effect on your credit score as the credit reference can’t really tell if it’s you closing the account or the provider.

Don’t worry about this, if they ask, you will have to explain and it could work in your favour as you are proving that you want to improve your chances of being accepted.

Remember that it’s always good to check up on these types of things just in case. For example, you could’ve lost a card and you didn’t realise, then you fall victim for fraud. This could end up having a worse effect on your score.

Remove your financial link to others

People often don’t know that they are still financially tied to a family member or ex-partner. If this is the case, it can have a negative effect on your credit score without you even realising.

If the account that you are still tied to is still active, you must know that you will not be able to remove your link just yet. If you want to remove any of these links, then you should get in touch with the credit reference agencies and make a request.

Summary

As a Mortgage Broker in Harrogate, we know that some applicants see credit scoring as an unfair way of determining whether or not you’ll get accepted for a mortgage. For example, you may have a low credit score due to personal circumstances that couldn’t be prevented.

As a Mortgage Broker in Harrogate, we mostly see that it’s people that are Moving Home or Self Employed struggle with their credit score. However, if this isn’t your mortgage situation and you still need help with improving your credit score, you know to get in touch with.

Sending an up-to-date credit report to your expert Mortgage Broker in Harrogate could prove extremely beneficial to your mortgage journey. A great tool that we always recommend to our customers is checkymyfile.com.

The more your advisor knows about your finances the better. There are still some lenders out there that prefer to do things the old-fashioned way and will manually assess your application. They will still have rules that they stick by about the number of defaults and CCJ’s that they will allow.

A Mortgage Broker in Harrogate, like us, likes to do things the new way and will always aim to deliver you the same fast and friendly mortgage advice service that you are all used to. We hope to hear from you soon.

In need of a Mortgage Agreement in Principle in Harrogate?

The purpose of an Agreement in Principle (AIP) is to determine whether or not you pass a Lender credit score to qualify for a potential mortgage. Sometimes this is also referred to as a Decision in Principle.

By obtaining yourself an Agreement in Principle, you are ready to support any potential offers you make as a First-Time Buyer in Harrogate. Having one of these may also put you in a place to negotiate a lower price as it shows the seller you are serious and have the means to proceed with the purchase.

Will obtaining an Agreement in Principle impact my Credit Score? 

Common practice these days seems to lean more towards soft searches, though even these could still affect your credit score. Usually this would be more likely with a hard search, with soft searches generally leaving your credit score unaffected.

The difference between the two, is that a soft search won’t dig as deeply as a hard search. You can always rest assured though that the lender has chosen either with the best of intentions.

Should I stay away from hard credit checks? 

Now and again a hard search or two should be fine. It becomes slightly more problematic if you start having multiple hard searches over a short amount of time. Soft searches won’t show up on your credit report, but a hard search will. This looks bad, especially if you don’t pass the different criteria.

Don’t let this put you off however, as if you know you know you have a good credit score and taking a hard search with that lender is the best deal, you’ll most likely be fine.

Does my Agreement in Principle a guarantee that I will get the Mortgage? 

We really wish it were the case, but sadly no, there are no guarantees that having an Agreement in Principle will get you a mortgage. You still need to present the lender with your documents and it’s only then, that the underwriter will make the final decision on your case.

A regular occurrence here at Harrogatemoneyman, is customers getting in touch after being declined at application stage. This is often down to missing some of the small print mentioned in their Agreement in Principle. You will need to provide identification for proof of who you are, payslips for proof of income, and bank statements for proof of handle your finances the right way. Without these, your case won’t go to offer.

Can I make an offer without having an Agreement in Principle? 

If we were to get technical, the answer is yes you can. However, it is highly unrecommended and any credible estate agent will not proceed without proof that you can proceed.

How long does is the process of getting an Agreement in Principle? 

Within 24 hours of speaking with a mortgage advisor in Harrogate it is possible to obtain an Agreement in Principle.

How long will an Agreement in Principle last?

Generally speaking, an Agreement in Principle will expire around the 30-90 days mark. The good thing is though, that this doesn’t mean you should just apply for the first house you find. If your Agreement in Principle expires, it is relatively straightforward to have it refreshed when you are ready to make an offer on a property.

Finding a mortgage only to be declined a mortgage can be a major disappointment, we get that. We recommend getting an Agreement in Principle as early as you can to avoid that disappointment.

Right to Buy Mortgage Advice in Harrogate

What Is The Right to Buy Scheme?

The right to buy scheme can allow tenants who live in England to purchase their property from the council for a discounted price.

If you have spent at least three years (not always continuous) renting from the public sector as opposed to privately and are secure tenants of council property, you may be eligible for the Right to Buy Scheme in Harrogate. In the right to Buy sale, the property will be valued at the full market price, with a government discount applied to it.

How The Discount Is Worked Out

The discount percentage depends on varying factors, such as where you are in the country and how long you’ve been a council tenant. A big advantage of the Right to Buy is that due to the discount, there will usually be equity in the house already. How much equity again depends on varying factors, such as how much your discount is and the value of the property.

We often find that those who utilize the Right to Buy Scheme are First Time Buyers in Harrogate. We love working alongside First Time Buyers and are here throughout every step of the process. This starts with your initial inquiry, all the way through to your completion.

The Right to Buy Process

• Firstly, you’ll need to contact the council and ask for an application form – This confirms your eligibility!
• Once you’ve been accepted, you’ll receive a purchase price, of which you’ll have a set amount of time to accept.
• Lastly, once a purchase price has been agreed on, we can get the ball rolling with your mortgage application!
  

Working out your monthly outgoings may be greatly beneficial to you if you are thinking of buying your council home.

Our recommendation is to work out what you have now as a tenant, then compare that to what it would be like if you were a homeowner. We are more than happy to help you out with this part.

Are you looking for a Mortgage Advisor in Harrogate?

As a knowledgeable and experienced Mortgage Broker in Harrogate, we can look through 1000’s of Right to Buy mortgage deals for you, tailored to your circumstances.

Throughout the whole process, we’ll offer a multitude of help and guidance, answering any questions you may have. We even aid with other local services when necessary, such as conveyancing.

Our brilliant team is incredibly proud of the service levels we provide day in and day out – This is reflected in our genuine customer reviews.