The banks you can get a mortgage from WITHOUT having to show your statements
LENDERS want to see all sorts of paperwork when you apply for a mortgage to verify whether you can afford the loan.
But there are a handful which aren't bothered about looking at your bank statements, according to .
Most banks ask for three months worth of statements to verify your income and outgoings, even though regulation rules say that they don't have to.
These rigorous background checks can lead to some borrowers watching what they spend in the months leading up to an application because an odd payment could be the reason they are rejected.
But Santander, Halifax and Virgin Money are among the lenders that have quietly moved away from this approach.
Instead, they focus on your credit score to determine affordability to work out where they will lend you the funds for your home.
How to make sure your first mortgage application gets approved
GETTING the funds together for a deposit is one thing, but actually getting approved for a mortgage is another.
Here are some tips you can follow to make sure your application gets approved first time:
Work out how much you can afford - Lenders reject unrealistic mortgage applications and that in turn will damage your credit score and make you worse off. The most you'll be able to borrow is four and a half times your yearly salary, which will give you some idea of your budget.
Take advantage of a scheme - Help To Buy ISA, Help To Buy equity loan and Shared Ownership are just some of the schemes the government is running for first-time buyers.
Check your credit score - If you've got a bad credit history then you're going to be rejected for a mortgage, which will only make your score worse, so it's worth checking before you apply.
Consider using a broker - A broker will be able to review a wider range of products and advise you on the right one for your circumstances. Remember though, they'll take a fee for their services so you'll need to factor that in to your costs. Digital mortgage brokers like Trussle and Habito are free to use though because they take a cut from the lender, not the borrower.
Save for a larger deposit - The more money you have, the less money you'll need to borrow and the more attractive you are to a lender.
Santander sent an email to brokers specifically asking them not to send borrower's bank statements unless they ask for them.
It also added that if they want the statement to verify a specific transaction like your salary, then they should only send in the page that has that on it.
This is because drilling in to statements could mean more work for the bank because they can't "unsee" any "dodgy" payments.
But not many banks advertise this because it could be seen as irresponsible and they don't want to be seen to encouraging this.
One broker warned that borrowers shouldn't treat it as a "get out of jail card".
Rachel Lummis from Xpress mortgages said: "The adviser will need bank statements for assessing affordability, proving income and compliance purposes and the lender fully expects the adviser to have them on file.
"The solicitor will need them for anti-money laundering purposes and proof of deposit."
Virgin Money confirmed to The Sun that this was indeed the case.
A spokeswoman for Santander told Mortgage Solutions: "Brokers have fed back that there is sometimes uncertainty around the paperwork that is necessary for each application, resulting in additional paperwork being needlessly collated and submitted.
MORE ON MORTGAGES
"To support them, we sent an e-mail clarifying the paperwork requirements – one element of this was around securing applicant’s bank statements.
"As a prudent lender, we must always ensure the necessary affordability checks are carried out so that people get the product that meets their needs and can afford the mortgage for the length of the term.
"The communication was designed to help brokers collect what was needed for bespoke cases, enabling them to quickly and easily get the right decisions for the customer."
A spokeswoman for Halifax said it doesn’t ask for bank statements as the lenders use "a variety of tools to assess a customer’s credit worthiness" including their credit scores.
Most lenders do still want to see your statements, although NatWest doesn't need to see your statements if you're already a customer.
Here is our guide to how long to fix your mortgage for after the interest rate hike.
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