Getting a mortgage

You usually need a mortgage to buy a home. Mortgages are sometimes called secured loans. Check what you can afford and how much deposit you'll need. Get independent mortgage advice before you apply.

Before applying for a mortgage

Check your credit rating

Getting a mortgage usually requires a credit check. You can check what information the 3 main credit agencies hold on you. There may be a charge for using their services.

Check your credit rating with:

If you have a bad credit score, their sites have advice on how to improve your rating.

Use a mortgage calculator

Use the mortgage affordability calculator on Money Helper to work out what you can afford. You'll need to know things like:

  • your salary and take home pay

  • your household costs, including travel, bills and living costs

  • any credit card or loan repayments you have

Once you know what you can afford to borrow, you can compare mortgages on comparison sites. Some comparison sites may take a fee or make money from promoting certain mortgages.

Decide how much deposit to save

Most mortgage lenders do not lend 100% of the value of the property. You’ll need to pay some of the cost yourself with a deposit.

Use the deposit calculator on Money Saving Expert to see what you need to save.

Deciding what type of mortgage to get

There are two main types of mortgage, repayment mortgages and interest only mortgages.

Repayment mortgages

Each month you pay back some of the money you borrowed, and some of the interest on the mortgage.

If you keep up your payments, you're guaranteed to pay off the mortgage at the end of the term.

Interest only mortgages

Each month you only pay towards the interest of your loan. Instead of repaying money you have borrowed, you pay into a long term savings plan, like an ISA.

At the end of your term, you should have saved enough to pay back the full amount you borrowed. This is more risky than a repayment mortgage, because you may not save enough.

Getting a mortgage with someone else

This is called a joint mortgage. You do not have to be in a relationship to get a joint mortgage.

If you're in a relationship, unmarried couples are usually treated the same as a couple who are married or in a civil partnership.

You're equally liable for mortgage repayments. This means if one of you cannot pay your share, the other person must pay the full amount.

You both need to agree to any mortgage terms changes.

Sharia law compliant mortgages

Halal mortgages are available for people following Sharia law. Check Money Helper’s guide to Sharia law compliant mortgages.

Getting mortgage advice

A mortgage adviser, broker or registered lender can help you find the right mortgage. They'll ask about your income and outgoings. Search online for a free mortgage advice provider.

Anyone selling mortgages must be registered with the Financial Conduct Authority. Check if a broker or lender is registered by searching on the Financial Services Register.

What to ask a mortgage adviser

Mortgage advisers may not be fully independent from the products they are selling. So it’s important to ask them:

  • whether they're making money from selling this mortgage

  • how much you can borrow

  • how much deposit you'll need

  • whether you can get a better interest rate if you can afford a larger deposit

  • what fees are involved and if there's anything you can do to avoid them

Getting a key facts document

If you're advised on a mortgage based on your income and outgoings, you should be given a key facts document. It must:

  • be clear and easy to understand

  • say the costs and terms of your mortgage

  • make it easy to compare with other mortgages

Checking the terms in a mortgage

Mortgage terms must be written in plain English. Any technical terms should be explained. If they're not, they could be unfair terms.

What to check for in the terms

  • how are the interest rates calculated

  • is there a penalty for switching mortgage at any time

  • is there a penalty for paying off the mortgage early

  • how much extra can you pay per year without having to pay an overpayment charge

  • is the mortgage CAT standard

CAT standard stands for charges, access and terms. It should mean the mortgage does not have any hidden charges or terms.

Checking for unfair terms

Unfair terms try to take away your legal rights, or make the contract much more favourable to the lender. An example is if the lender can change the interest rate without any warning.

If you think a term is unfair, write to your lender. Ask them to explain the term and say why you think it's unfair. If you’re not happy with their response, you should get consumer advice from Citizens Advice.

Applying for a mortgage

You need to make an appointment with the lender to apply.

Ask the lender what to take with you to the appointment. They’ll usually ask for things like payslips, bank statements and proof of regular rent or mortgage payments.

If you apply for a mortgage before you find a property you want to buy, you can get a mortgage certificate. This shows the seller you can afford the property. Ask the lender for this if you need it.

Problems when getting a mortgage

If you cannot afford a mortgage

If you're on a low income, you could buy a home through shared ownership. This is where you and a housing association purchase a new property together.

If you buy a home through shared ownership, you'll own a share of the property and pay some rent to the housing association to cover the part they own. Usually you'll have the right to buy a larger share or purchase your home outright when you can afford to.

Check our guidance on buying a home through shared ownership.

If you’re disabled and on benefits

Receiving benefits as part of your income because you're disabled should not stop you getting a mortgage.

You could get housing cost payments to pay the mortgage interest if you get:

  • Income Support

  • income based Jobseeker’s Allowance

  • Pension Credit

There might be restrictions on the amount you can get. Get benefits advice to make sure you're getting the correct amount.

Follow our guidance on buying a home.

If you think you're being unfairly treated by a mortgage lender

Write to the lender and explain your concerns. Tell them what you want them to do so they can put things right.

If you're unhappy with their response, you can apply to the Financial Ombudsman Service. This is a free, impartial service which resolves mortgage complaints.

Discrimination when you apply for a mortgage

It’s against the law for mortgage lenders to discriminate against you because of your:

  • disability

  • gender

  • race

  • religion

  • sexual orientation

Check your rights and what you can do if you're being discriminated against.

Last updated: 4 October 2022

Housing laws differ between Scotland and England.

This content applies to Scotland only.

Get advice if you're in England