Six mortgage market dos and don'ts

2 February 2012

Buying a home isn't an easy process – follow our six-step guide on what you should and shouldn't do when trying to secure that all-important property.


1. Seek professional help

Although it's possible to do your own research about areas and property types that you may like, buying a home is a complicated process. Calling on the help of a professional will ensure you haven't missed out any options. Go to and type in your postcode to find a mortgage adviser close to you.

2. Borrow money

If you've never taken out a credit card or personal loan, it could actually be worth borrowing some money – so that you can pay it back and build up a good credit rating. This activity will prove you are a responsible borrower and a good credit rating will also give you access to the best mortgage deals.

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3. Organise your paperwork

Have to hand at least three months' bank statements to show you don't exceed your overdraft limit. Before submitting a mortgage application also have to hand proof of identity, your P60, details of any loans or credit cards and recent payslips. 


4. Fall for the headline rate

Dan Clayden, spokesperson for IFA Clayden Associates, says: "Don't become a mortgage moth and get drawn in just by the headline rate." You also need to factor in the costs of arranging a mortgage. Some lenders may offer lower charges so you need to work out if these offset the higher mortgage rate and subsequent monthly mortgage bill – or not.

5. Bank on rising property prices

In the past, buying a home was seen as a major investment and homeowners relied on the fact that their property would increase in price – this isn't the case now. Instead, view your property as a "stepping stone" that gives you the freedom to decorate and alter it as you like, says Kevin Tooze, spokesperson for IFA Equity Partners UK.

6. Stay on the SVR

It's never worth staying on the standard variable rate (SVR). With the base rate stuck at 0.5%, fixed and tracker mortgages promise better rates at the moment.

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