Lenders will look at various aspects when it comes to your bank statements. Their main job is to decide whether or not you are the kind of person that they are going to want to lend to. They want an applicant who can manage their finances responsibly and is going to be able to keep up-to-date with their mortgage payments.
Regarding your bank statements and what lenders look for on them, let’s take a look at gambling transactions and how they can sometimes affect your ability to get a mortgage in Sheffield.
Whether it’s a once every couple of months or a regular occurrence, gambling in large amounts can often trip your mortgage application up. This also applies to you if you are frequently gambling. Whether you are losing money or not, you may be declined due to your gambling habits.
At the end of the day, no one can tell you how to live your life, although, it is always advised that you ‘gamble responsibly’. Remember that a lender needs an applicant that doesn’t oppose risk to them. They need someone who’s going to meet their mortgage payments month on end; they want no risk of repossession.
Put yourself in your lender’s shoes, would you lend money to someone who has the tendency to gamble frequently with large sums of money or someone who’s always on top of their payments and doesn’t gamble their money?
It is in no way illegal to gamble, therefore, the occasional gambling transaction on your bank statements will not mean that you’ll get automatically declined. They will assess the gambling transactions though, looking at whether they are reasonable and responsible. They will look at how frequent you gamble, the size of the transactions and how they relate to your income.
If you are infrequently gambling in small amounts, it should make no significant difference to whether you get accepted or not. Lenders may even just brush it under the rug. On the other hand, if you are a regular gambler, their viewpoint may be the opposite. You can’t be eating into your overdraft due to gambling either, it will reflect badly on your application.
Lenders will examine your bank statements carefully. They will be looking for lots of different things, but ultimately, they want to see your bank statements and get the confidence that you are a reliable applicant that they’d be willing to lend to.
If you are exceeding your overdraft limit month on month, your lender may begin to think that you struggle to take care of your finances. It’s likely that they’ll be okay with you doing so, however, we always advise that you be wary. They will also look for any other existing credit commitments that you have; it could be a credit card or a loan, etc. This is an important factor as you need to compensate a set amount each month to pay back the loan – the same as mortgage payments.
You should also look out for credit transactions from pay-day loan companies or otherwise known as “undisclosed” loan repayments. These can cause problems if you told them that you had no further loans to account for but then they appear on your bank statements. You need to be transparent with your lender and tell them everything prior to them viewing your bank statements.
As a mortgage broker in Sheffield, we will always say that the easiest way to improve things is to be sensible and if it’s possible, plan ahead.
Usually, your lender will ask for a minimum of three months bank statements. So, in theory, before you apply, you can get yourself prepared and maybe tone down on things such as gambling and dipping into your overdraft. All the little things can sometimes help.
If you use a mortgage broker in Sheffield like ourselves, they will help you with this whole process and recommend the option that will benefit you the most. There are some specialist lenders out there that will ask for fewer bank statements than others, a mortgage broker may be able to help you access one of these deals.
At the end of the day, the message to remember is to gamble responsibly and take care of your finances!
If you are a first-time buyer in Sheffield and this is your first hands-on experience with the mortgage world, you should definitely get specialist mortgage advice from a mortgage advisor in Sheffield. They will guide you throughout the whole mortgage process and help you with your application and get you on track.