Getting a Mortgage in Wales

Do you need a mortgage in Wales? Perhaps you live there and are hoping to take your first step onto the property ladder. Maybe you live elsewhere but need a mortgage for a property you’re buying. Or are you a landlord looking to expand your portfolio?

Whatever your situation, if you’re looking to get a mortgage in Wales, it’s worth having all the up-to-date information before making your application.

Can you get a mortgage in Wales?

Yes. If you have a regular income, a decent-sized deposit and strong enough credit history you should have no problem taking out a mortgage in Wales. But even if you don’t tick all these boxes, you still have a good chance of having a mortgage approved. You might just need the help of a specialist broker who can find the right lender for your circumstances.

Most of the well-known UK lenders offer mortgages in Wales but there are some – such as Swansea Building Society – that operate almost exclusively in Wales.

If you’re buying a non-standard property, for example, a remote cottage up in the hills, it might be worth having a chat with a Wales-based lender as they’ll be familiar with the area. A local broker who has in-depth knowledge of the Welsh market can also help guide you through the mortgage application process.

What type of mortgages are available?

You can get all the usual types of mortgages available in the UK in Wales. Here’s a round up of the main ones and any differences you should know about…

First-time buyer mortgages

First-time buyer mortgages are widely available in Wales.

There aren’t any major differences between being a first-time buyer in Wales compared to the rest of the UK. You’ll still have to meet lenders’ eligibility requirements and pass their affordability checks.

First-time buyers in Wales can access the mortgage guarantee scheme, which is a government initiative designed to encourage lenders to lend to buyers with less than 10% deposit.

Help to Buy

They can also make use of Help to Buy, the government scheme to help people who are struggling to buy a property get on the housing ladder.

There’s a slight difference with the Welsh scheme though. In Wales you can use Help to Buy to buy a house worth up to £250,000 whereas in England, the limit is £600,000, depending on where in the country you’re buying .

Help to Buy – Wales enables buyers with a 5% deposit to borrow up to 20% of the property purchase price from the Welsh government interest-free for five years. They then borrow the remaining amount from a lender. The loan must be repaid after 25 years, or earlier if the property is sold.

In Wales, the scheme is open to all buyers as long as it’s their only home. This is different to the English version of the scheme, which is only available to first-time buyers. The scheme is running until March 2022, although it could be extended depending on funding.

Buy-to-let mortgages

Wales has plenty of opportunities for both budding landlords and experienced buy-to-let investors. The areas around Cardiff and Swansea are particular rental hotspots. As a result, a range of lenders offer buy-to-let mortgages in Wales. But remember, buy-to-let mortgages typically require bigger deposits, and you’ll probably end up paying a reasonably high interest rate.

If you’re interested in taking out a buy-to-let mortgage, it’s worth talking to a local broker who has first-hand knowledge of the market. They’ll not only be able to share their advice on rental areas, but they can also find the best lender to suit your needs.

It’s also worth noting that all landlords in Wales must now register with the Rent Smart Wales scheme or face a fine of up to £150.

Right to Buy

The Right to Buy scheme allows council tenants to buy their homes from the council at a discount. The scheme is now closed in Wales.

How to get a mortgage

If you want to take out a mortgage in Wales, there are a couple of things you can do in advance.

This is what we recommend….

Step 1. Get the right documents together

It doesn’t matter where you’re getting your mortgage, it always pays to have your paperwork in order. Being organised can save you precious time and speed the process up.

You’ll typically need three months’ of bank statements, proof of address, proof of income and a copy of your credit report, among other documents.

You can find a full list of the paperwork you’ll need in our complete guide to mortgage applications.

Step 2. Check your credit reports

Whether you’re getting a mortgage in Wales or elsewhere, nearly all lenders will look at your track record of paying back loans by searching your credit reports for any red flags.

Your credit report details all your past loans and records how well you paid them back. If there are any mistakes on your report, you can challenge them, or at the very least, add a note to your report explaining any late or missed payments.

Black marks on your credit report won’t necessarily stop your mortgage getting approved but it could make things tricky. An experienced broker can advise you if you have had bad credit.

Download your credit reports through our dedicated credit reports hub.

Step 3. Speak to a local broker

Although getting a mortgage in Wales shouldn’t be overly complicated, it’s a good idea to connect with a local broker who has direct knowledge of the market. They’ll be able to tell you which lenders to approach, and they may be able to get access to exclusive deals. They can also negotiate with lenders on your behalf.

Our free broker-matching service will quickly assess your needs and circumstances and pair you with a mortgage advisor who’s ideally placed to help you. Make an enquiry to get started.

Do lenders have any specific eligibility requirements for Welsh mortgages?

There are no specific eligibility requirements. Lenders will apply their standard criteria, which typically includes looking at whether you can afford the loan, the size of your deposit, and your credit history.

As with all mortgages, if your circumstances are even slightly atypical – for example, you’re self-employed or you’ve had bad credit in the past – the lender will look at your application more closely and you’ll probably be asked for more information to make sure you can afford the loan.

What deposit do you need?

Again, there are no specific rules when it comes to the size of the deposit you need to put down. In Wales, as is the case elsewhere in the UK, the deposit you’re able to put down will depend on the lender’s assessment of your individual circumstances.

If you’re a first-time buyer in Wales, you can, in theory, get a mortgage with just a 5% deposit.

Get matched with a Welsh mortgage broker

Getting a mortgage in Wales isn’t really any different to getting a mortgage elsewhere in the UK. However, the Welsh housing market has its own characteristics, so it’s shrewd to work with an experienced, local broker who knows its ins and outs and who can identify the best lenders to approach based on your circumstances.

Make an enquiry and get matched with a Welsh broker today. We hand-pick all the brokers in our network and rigorously vet them on your behalf so you can be assured you’re getting the best advice possible.