What is the Mortgage Process? Explained by SAM Conveyancing. A magnifying glass observes a stack of coins beside a toy wood-block house
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Mortgage Process

9 min read
What is the mortgage process? If you don't have enough money to buy a home with your own cash - and most people don't - you'll need to secure a mortgage loan.

You firstly need to apply to a lender for one and you should expect to field searching questions about your financial affairs and to be able to produce evidence that you'll be able to pay the loan back.

If your application is successful, three stages follow before you are granted your loan. These are:

A decision in principle is a non-binding estimate of how much the lender is willing to lend you. This is based on your annual income and a preliminary credit check. (Most banks will only do a 'soft' credit check at this stage)

The benefit of a decision in principle is it confirms what the bank will lend you based on your deposit and income (most commonly your salary, but pensions, property income and share income is taken into consideration.

This article explains what happens at each of the three stages and offers tips and guides of what you can do during the mortgage application process to make it as smooth as possible.

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1 Apply for a mortgage agreement in principle

Once you have chosen a mortgage lender you'll first need to apply for a mortgage in principle. If you are successful, your lender contacts you to tell you that you've received a mortgage agreement in principle. You may think that the mortgage application process is over, however, this is only the first stage completed and you are still a few weeks away from getting your mortgage offer.

A Mortgage in Principle is when a lender tells you that it is prepared to lend you, in principle, a defined sum, towards buying a property. It is 'in principle' because the lender then has to value any property which you have an offer accepted on to decide whether the home is worth the money that it has, in principle, offered you money towards. It is dependent on your household income multiples as well as affordability based on Mortgage Market Review criteria.

Declare if you are getting a gift or a loan

If you are getting a gift or a loan from a parent or friend then you need to declare this to your mortgage lender at the earliest stage possible as it could affect whether they will lend to you or not. If you aren't sure whether the money is a gift or a loan then read this article - Is it a gift or is it a loan?

What should you do after receiving a Mortgage in Principle?

You are now able to look for properties you like and are able to buy, limited to the sum the lender has offered you in principle and your own resources.

Once you have found a property you like, you put in an offer to the vendor. Once you've had an offer accepted - congratulations! - you then book your Mortgage Valuation.

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The mortgage application process is more stringent than ever: use our checklist to maximise your vital preparations for it.

2 Book your Mortgage Valuation

You must pay for your mortgage valuation with your mortgage lender (Read more about the Mortgage Valuation), in which your lender sends a surveyor to the property to inspect it to see if its value is consistent with the sum the lender is prepared to offer you to buy it.

If the lender decides, after the surveyor has delivered to it their valuation report, that the property is not worth the money or it has defects, it may either refuse to lend you the money on that property or set conditions which you must fulfil if they are to lend.

It might, for example, stipulate that you have to carry out, at your expense, a Pre-Purchase Survey to examine an issue it has found. Issues can include, for example, subsidence, radon gas or drainage problems.

Once again, if this survey indicates many problems, the lender can refuse to lend on the property.

Is a Mortgage Valuation the same as a home buyers survey?

No. The former is purely for the lender's benefit and focuses mainly on establishing a property's market value - read more about this here.

The latter involves you booking a surveyor who works on your behalf to establish if the property you've set your heart on has any defects.

If there are, you can bargain with the vendor to contribute towards or even pay all of the costs of remedying any issues or even choose to pull out.

We always advise you to get a home buyers survey: you are probably about to spend the largest sum of money you've ever spent in your life and ideally need an expert opinion on whether your property has any issues which might prove exorbitant to fix further down the line.

Once your Mortgage Valuation survey has taken place and the surveyor has returned their report to the lender, the lender either agrees to grant you a mortgage, tells you that it will grant it under certain conditions or refuses to grant you the loan for that property, in which case you can either appeal or look for a fresh home to buy.

If you need a RICS Building Survey or HomeBuyer Report then call our team now on 0333 344 3234, or:

3 Receive your Mortgage Offer

If a lender is satisfied with the Mortgage Valuation report, it then tells you and you receive your Mortgage Offer. This is a highly important stage which you must reach before you can exchange contracts with the vendor.

Unless you are a cash buyer, a seller will pull out of dealing with you if you can't prove that you will be lent enough cash from a lender to cover the agreed purchase price.

The mortgage offer is unlikely to be rescinded unless it is found out through the conveyancing process that there is a legal issue or if any of the information provided to the mortgage lender is incorrect.

The solicitor acts for the mortgage lender and satisfies their requirements which are shown in the mortgage offer and also the Mortgage Lender's Handbook which can be found on the Council for Mortgage Lenders' website.

Mortgage lenders require you to buy property searches before they'll agree to give you a mortgage. What searches they require are set out in the Council for Mortgage Lender's Handbook.

The minimum requirement is the Local Authority search, however they may also require the Environmental Search and Water & Drainage Search.

Some mortgage products require for you to seek separate legal advice before the mortgage lender will agree to lend you the mortgage.

We have a legal advisor who undertakes this work so please call us if you need support on 0333 344 3234 (local call charges apply).

Frequently Asked Questions

Here is a non-exhaustive list of things that could affect your mortgage application process:

Generally it takes between 2 to 6 weeks from application to approval. However, this does not include the time from mortgage in principle to application.

You should be able to get all of the required searches and surveys complete within this time. But it's worth checking when you apply, whether there are any delays at the local authority, for example, which could push things back.
First, you apply with one or more lenders for a 'mortgage in principle'. This is an estimate of how much money they would be willing to lend you.

Now you know how much you can spend, you shop for houses, put in an offer and hopefully, your offer is accepted.

Once the offer has been accepted by the buyer you can 1) Instruct a conveyancer 2) Submit your mortgage application 3) Arrange your mortgage valuation 4) Arrange your conveyancing searches.

When the lender has all of the above information, (as well as proof of your income and a full check on your credit score) they will decide whether to give you your mortgage offer.

NB In rare cases a mortgage offer can be withdrawn at any time up until textcompletion.

    Mortgage in Principle


    Your offer is accepted on a house


    Mortgage Application


    Mortgage Valuation (& property searches)


    Mortgage Offer

The full process is explained in the article above.

We have specialist mortgage advisors who have access to the whole of the mortgage market and provide 100% free mortgage consultation so you pay nothing. Please call us to and we can talk to you today on 0333 344 3234 (local call charges apply) or:

Access to whole of the market – 100% Impartial advice – No need for face-to-face meeting

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