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Dundas Street - Edinburgh

Top 6 Mortgage Misconceptions

Many people dream of owning their own home but think they won’t be able to get a mortgage to fund it due to common misconceptions.

Our adviser Ashley Mason busts the top 6 mortgage myths which may be costing you your dream home.

 1. You can’t get a mortgage if you’ve just changed jobs

Many people think they need to have been with their current employer for at least six months in order to get a mortgage. Whilst this may be the case for some lenders, the majority of lenders don’t expect this, as long as you can evidence that you’ve been in employment for the last 12 months. The main thing is that you can provide payslips to prove you’ve had a permanent source of income for the past year and that there has been a natural progression from one job to another.

2. Self-employed people will suffer from higher interest rates

There’s a common misconception that those who are self-employed will have to pay a higher interest rate on their mortgage, which may be deterring such people from looking into their mortgage options. However, this is usually not the case. As long as they can provide two years of accounts, there are lenders who are willing to provide the same rate to the self-employed as those who have an employer.

3. The interest rate lasts for the whole term of the mortgage

In some countries, you have to pay the same interest rate you initially agreed to for the length of your mortgage term. However, in the UK it’s more common to change your mortgage rate throughout the term. You may be able to change the product you’re on, as well as the lender you’re borrowing from, which may lead to a reduction in your interest rate.

 4. The rate you pay is based on your credit score

Whilst your credit score is an important factor when applying for a mortgage, different lenders will use your credit score in different ways. Not all lenders will base the rate on your credit score and many deem the loan-to-value (LTV) and affordability to be more important when determining the rate. However, keep in mind that your credit score is still an important factor in your mortgage application, therefore it’s still beneficial to try and improve it in advance of your application.

5. You need to have a large deposit

It’s a common belief that you need to save tens of thousands of pounds in order to fund a deposit for a mortgage. Whilst it’s advised to save as much as possible for a deposit, it’s very common for people to get a mortgage with just a 5% deposit with a respectable interest rate. Also keep in mind that there are many government schemes available which help to build your deposit, such as Help to Buy and LIFT.

6. Your mortgage gets written off if you pass away

Many people are shocked to hear that even if they die, their mortgage debt isn’t wiped off. In this situation, the mortgage debt would need to be paid back to the lender before any money from the estate could be claimed by whoever is written into your will. If the mortgage couldn’t be repaid, then the house would have to be sold. It’s therefore important to think about protecting yourself and your mortgage in case the worse was to happen, so that your next of kin would be able to retain your property.


Still have some mortgage questions? Contact Ashley our one of our other specialist advisers on 0800 652 6649 or email

Because we play by the book we want to tell you that…

Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1%, but a typical fee is 0.3% of the amount borrowed.

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