Handy tips for first-time buyers giving their bank account a clean-up for their application

According to Aldermore Bank, this year has seen an average of only 1 in 5 being accepted first time for their mortgage applications compared to an average of 3 in 5 last year.
If you or someone you know is a first-time buyer your bank statements are a crucial part of evidencing your financial stability to be able to take on a mortgage, and they say a picture paints 1000 words, but what words is your bank statement shouting about you and your mortgage suitability?

Inside Jokes
Transferring money between ourselves and friends and family is normal, maybe you’re splitting the dinner bill, or sharing the costs of a holiday? But ensuring the reference added to the bank transfer isn’t going to make you blush when you meet with your mortgage adviser is crucial. Noting the genuine reason for the transfer could help prevent questions later-on.

Cash gifting
If you’re looking to secure your first mortgage, you want to demonstrate your financial stability and having sums coming out of your account giving you less money in your account, could affect affordability calculations. Trying to avoid unexpected costs such as new furniture or appliances until you’ve secured your mortgage could also help demonstrate your financial viability.

Frequent flutters
Many of us enjoy taking a chance on the National Lottery once in a while, or picking up a scratch card occasionally, but frequent gambling transactions that amount to large totals, could alert lenders when considering your affordability. Small amounts here and there are unlikely to have an impact- so here’s hoping for that rollover win still.

New job
Firstly, new jobs are certainly worth celebrating but a change in your salary may make a lender question how reliable you are for a repayment. Even if your new income is higher than a previous job, lenders may need reassurance that you can afford to make your repayments and long-term employment is one of the best reassurances. IF you have changed jobs, it may be worthwhile asking your new employer to provide a letter ensuring your ongoing salary expectations with the job, to allay any reserves your lender may have.

Deposit paper trail
Many first-time buyers are gifted some or all of their deposits but its vital to keep a record of its journey out of bank accounts and into other accounts. Many applications have been delayed when they’ve been subjected to fraud investigations, as moving cash can often indicate money laundering, lenders and financial services professionals are obligated to look out for these actions and investigate if necessary- a thorough paper trail will help avoid this necessity.