Making a mortgage application can feel like a big step - you’re officially asking to borrow money to buy a home. It can take weeks to get an approved mortgage offer but being prepared and knowing what to expect can help you avoid unnecessary stress.

What is the process of applying for a mortgage?

There are several steps when making a mortgage application - though you might not compete them in exactly this order.

Work out what you can afford

It's important to balance borrowing enough to buy your home with making sure your monthly repayments are manageable now and in the future.

Use a mortgage calculator to estimate your monthly repayments and compare them to your budget. Consider how you’d manage financially if your circumstances changed, such as a drop in income due to job loss or taking parental leave.

Research your mortgage options

With so many mortgage options – fixed, variable, interest-only, repayment, discount, and tracker – it can feel overwhelming, especially for first-time buyers. That’s why it’s helpful to research and understand common mortgage types. You can also explore if you’re eligible for government homebuying schemes, which can help if you’re struggling to get on the property ladder. 

Get a mortgage in principle

You can get a mortgage in principle (MIP) by providing a lender details of your salary and regular spending. An MIP shows how much they might be willing to lend you and can help you plan your homebuying budget. Most lenders offer this service free on their website. If you’re using a mortgage broker, they will secure this for you.

Submit your full mortgage application

Most people apply for a mortgage using a mortgage broker or adviser, particularly if they have secured you a mortgage in principle with the same lender. The broker handles most of the work, including completing and submitting the application for you.

If you’ve researched your options and are confident in your choice, you can apply directly to the lender yourself. No matter how you apply, you’ll need to supply certain documents as part of your application, including proof of income and deposit, bank statements and ID.

It typically takes 2 to 6 weeks to find out if your mortgage is approved. During this time, the lender may arrange a valuation survey to ensure the property is a safe investment. The survey might be paid for by the lender but always check in case you need cover the cost.

The survey results can affect your final mortgage offer. If the property is overvalued or has issues that could lower its value, the lender may delay the process or reduce the loan amount.

Review your mortgage offer

If everything goes as planned, your broker or lender will contact you in a few weeks with a mortgage offer. Once you receive the offer in writing, review the paperwork carefully to make sure it matches your expectations. You typically have seven days to accept or cancel if you change your mind.

What is a ‘mortgage in principle’?

A mortgage in principle (MIP) is a conditional mortgage offer that gives you an idea of how much a lender (usually a bank or building society) might let you borrow. It is not a guarantee of your final mortgage offer which is only confirmed after you apply.

Different lenders use different terms, but a Mortgage in Principle (MIP), Decision in Principle (DIP), and Agreement in Principle (AIP) all mean the same thing.

What documents do you need when applying for a mortgage?

The documents you’re asked for may vary, but your lender or broker will confirm what they need from you. Commonly requested documents include:

• proof of address (utility bills or bank statements)
• proof of earnings (typically three to six months of payslips)
• proof of identity (passport or driving licence)
• P60 form from your employer
• bank statements from the last three to six months
• proof of benefits received (if applicable)
• proof of deposit (such as savings account or LISA statements)
• gifted deposit declaration (if any part of your deposit is a gift).

If you’re self-employed, you’ll also need:

• statements of accounts for the past two to three years
• tax return form SA302 (if you have multiple income sources).

What to do if your mortgage application is refused

If your application is refused, don’t worry – there are options. Avoid the temptation to apply again straight away. Making multiple mortgage applications in a short space of time will impact credit score. Speak to your mortgage adviser about your next steps or read MoneyHelper's guide What to do when your mortgage application is declined.

You may be able to make simple changes that can help, like registering to vote or correcting any mistakes on your credit file. Common reasons for rejecting a mortgage application include:

• poor credit history
• too much debt
• incomplete employment history
• income too low to cover monthly repayments.

If any of these apply to you, check out these helpful guides and tools:

• How to improve your credit score
• Help if you’re struggling with debt
• Budget planner

How your credit history can affect mortgage loans

A low credit score can lead to a rejected mortgage application. Missed or late payments on your credit report can suggest you’ve struggled to manage your finances, which is a red flag for lenders. That’s why it’s important to check and improve your credit report before applying.

If you need a mortgage now but have a less-than-perfect credit score, a mortgage broker could help. They can search the market for you to find the best deal and check which lenders are more likely to accept your application.