Updated: December 17, 2021

Bank Statements for a Mortgage

How many months of bank statements do you need for a mortgage? Are there any lenders that don't ask for them? Find all this and more in our in-depth guide!

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Pete Mugleston

Author: Pete Mugleston - Mortgage Expert

Updated: December 17, 2021

When it comes to applying for a mortgage, paperwork is unavoidable. Lenders want to know how financially reliable you are so they can determine how much money you can borrow for your mortgage. Providing copies of your bank statements is a key part of that process.

By following this guide, you’ll have a better understanding of why lenders ask for bank statements, what they’re looking for and who you can turn to for guidance if there’s a problem.

Why do lenders ask for bank statements?

For a lender to offer you a mortgage they need to know you can afford to make the repayments. The quickest way to determine that is to look through your most recent bank statements.

The requirements vary from lender to lender but in most cases you’ll be asked for the last 2-3 months statements as a way of providing a snapshot of your incomings, outgoings, spending habits and savings.

When sifting through the statements, lenders are mainly checking that everything is what they call “sourced and seasoned.” This means knowing that any funds you’ll be using are legitimate and that you’ve had them for longer than a few months.

In particular, they’re looking at:

  • Whether or not you can afford the mortgage
  • Whether you have the money to cover a deposit and any other fees
  • Where the deposit has come from
  • Any signs of fraudulent activity

Lenders have strict policies in place that means they have to check they’re not lending to someone who is money laundering or committing fraud. Checking your bank statements is a quick and easy way to tick that off their list.

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Are there any lenders who don’t ask for statements?

Yes there are. For most mortgage lenders, it’s a built-in part of their procedures but some, such as Virgin Money and Santander, only need to see bank statements upon specific request to verify an applicant’s earnings.

If you’re working with a broker, they’ll know which lenders ask for what documents (and why). If you get in touch we can arrange for an expert to contact you straight away and match you with a mortgage lender who uses other methods to verify income, if that’s your preference.

What do underwriters look for in your bank statements?

You might cringe at the amount you spend on the monthly shop or the number of streaming subscriptions you have, but that’s not what lenders are going to judge you on. They’re more concerned about anything that could make you appear as a high-risk borrower.

Indicators might include:

Untraceable cash deposits.

If there are large sums of money popping up in your account that can’t be accounted for, that will definitely set off alarm bells as a sign of potential money laundering.

Overdrafts and non-sufficient funds charges.

This would indicate to a lender that you might run into issues when it comes to the monthly repayments so you want to make sure that your statements are robust and show you as the reliable borrower you want to be.

Funds from overseas savings.

It all goes back to being able to trace and verify and when it comes to money from abroad that can be a little harder to do.

Evidence of regular gambling.

Lenders want people they can trust with their money and excessive gambling speaks to high risk behaviours. However, if you have won what would amount to your deposit through gambling, you can still use it to buy a property.

Payday loans.

As necessary as payday loans might be, they also make a potential borrower seem unreliable. This is even if they’ve already been paid off.

If one of these factors shows in your statements then don’t worry too much. It doesn’t mean your mortgage application will be rejected, you just might be asked for further clarification.

Get matched with an experienced mortgage broker

Providing your most recent bank statements is something that most lenders will require when you apply for a mortgage, so it’s worth preparing them well in advance.

If you’re worried about any aspect of what your statements show, it’s worth speaking to a mortgage broker before submitting your application. They’ll be able to give you the benefit of their experience and, in most cases, you’ll find your concerns are unfounded – but it’s always worth checking!

Benefits of using a broker

An experienced broker can help with a lot of the procedural issues you might come up against and act as a buffer between you and your mortgage provider. The advisors we work with submit bank statements as part of mortgage applications every day, and are well-positioned to guide you through the process, saving you a lot of time.

  1. They have the know-how when it comes to what lenders are looking for so can take a preliminary look at your application and tailor it to their specifications.
  2. They know which lenders require bank statements and can match you with one that’s likely to get you the best mortgage for your situation. Matching with the right lender first helps to avoid unnecessary marks on your credit report.
  3. If any issues crop up with the bank statements you submit, the brokers are trained and on-hand to give advice as to what to do next

Call 0808 189 0463 or make an enquiry and we’ll set up a fee, no-obligation chat between you and your ideal mortgage broker today.

FAQs

How do I share my statements?

This is something a broker will be able to talk you through but generally you can go to your online banking and download your past few statements as CSV files.

I have multiple bank accounts. Do I share statements from them all?

You should share any statements from bank accounts holding funds that you think will contribute to mortgage payments.

Is there anything I can do to make my statements look better?

Make sure that, in the months before you submit, your spending isn’t excessive and that there are none of the aforementioned red flags. If you’re wanting to make a big purchase, maybe hold off until after the statements are submitted.

I’m self-employed. Will that affect my statements?

If you’re self-employed, you’ll likely be asked to share more statements. These will be supplemented with your tax returns so a lender can see what is typical for you to earn.

Ask a quick question

We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects. Ask us a question and we'll get the best expert to help.

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Pete Mugleston

Pete Mugleston

Mortgage Expert

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

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FCA Disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms that are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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