Mortgage Lenders Look For ‘Affordability’
Equifax offers tips to consumers preparing to move home or re-mortgage
According to new data*, an unprecedented number of home buyers are opting for fixed-rate mortgage deals. With the race on to get a good deal, leading online credit information provider, Equifax, is reminding anybody that might be considering moving home or re-mortgaging that they should check their credit report before making any applications.
“Lenders must demonstrate that they have properly assessed consumer affordability when extending new credit”, explained Neil Munroe, External Affairs Director, Equifax. “And this is particularly important in the mortgage sector – often reflecting the biggest borrowing a consumer might make in their lifetime.
“The Mortgage Market Review, which comes into effect on 26th April 2014 places even greater onus on the lender to assess affordability and an individual’s credit information will play a crucial role in that assessment, alongside other information gathered as part of the application process. We are, therefore, urging people planning to re-mortgage or move home to take a look at their credit information – before they start making applications.
“It’s much easier to tackle any factors that might be affecting their credit status before making new applications, rather than having to address them once the process has started.”
To understand what can impact a person’s credit file and what can affect their ability to get the best mortgage deal, Equifax has created the following top tips:
Equifax Top Tips for Home Movers
- Your Credit Report - Before you do anything get a copy of your Credit
Report – www.equifax.co.uk
- Credit Agreements - Make sure all current credit agreements are shown as paid up to date. Your credit file will highlight any dormant accounts you might have forgotten about. Closing these could improve your credit status, as will paying off any agreements early.
- Are you Registered? - Check you are registered on the electoral roll at your current address – this is a crucial first check carried out by lenders to ensure the applicant is whom they say they are.
- Shopping Around for a Mortgage - When shopping around ensure enquiries are logged as ‘quotation’ searches rather than ‘application’ otherwise multiple searches in a short space of time could impact on your ability to get credit.
- Your Mortgage Application - Don’t be tempted to make untrue statements on your application, such as increasing the amount you earn. Lenders will independently validate what you put on your application form and if they find discrepancies this may jeopardise your chance of getting a mortgage.
- County Court Judgments (CCJs) - If you’ve had a CCJ and it is now settled make sure the settlement is recorded on your credit file. If not contact the court to get confirmation details and inform the credit reference agencies.
- Avoid a high balance on your credit cards - Avoid carrying a high balance on credit cards. Lenders may view this as a sign of you having too much credit already and that you therefore may not be able to keep up with any new repayments.
The Equifax Credit Report is accessible for 30 days free simply by logging onto www.equifax.co.uk. If customers do not cancel before the end of the 30 Day Free Trial, the service will continue at £9.95 per month, giving them unlimited online access to their credit information and weekly alerts on any changes to their credit file. It also includes an online dispute facility to help them correct any errors on their credit file simply and quickly.
ENDS
*Mortgage Advice Bureau, 24th March 2014
For further press information, please contact: Clare Watson, Cecile Stearn, Parm Heer or Wendy Harrison at HSL on 020 8977 9132 / Fax: 020 8977 5200 or email: equifaxbtocteam@harrisonsadler.com
About Equifax
Equifax is a global leader in consumer, commercial and workforce information solutions, providing businesses of all sizes and consumers with information they can trust. We organize and assimilate data on more than 500 million consumers and 81 million businesses worldwide, and use advanced analytics and proprietary technology to create and deliver customized insights that enrich both the performance of businesses and the lives of consumers.
Headquartered in Atlanta, Equifax operates or has investments in 18 countries and is a member of Standard & Poor’s (S&P) 500® Index. Its common stock is traded on the New York Stock Exchange (NYSE) under the symbol EFX. For more information, please visit www.equifax.com.