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How to apply for a housing loan

In the past when people wanted to apply for a housing loan they would need to have six months worth of savings history and a sizable deposit in order for the loan to be approved. This is no longer the case. Today many banks and finance companies are willing to lend to people with no deposit without sighting any bank statements. This makes the process of applying for a housing loan much easier.

The next step in the process is choosing the bank the borrower wants to take out a loan with. Many people simply choose the bank that they currently do their banking with. This can be a costly mistake as some banks have lower interest rates than others. While an interest rate reduction of 1% or less may not seem like worth changing banks for, it can save borrowers thousands of dollars in interest repayments over the years. Two common companies that people in the UK often approach for a home loan are Halifax and Barclays.

Once the borrower has decided where they want to apply they will need to complete a loan application. This can be done over the phone, in person and in many cases on the internet. During the application process the borrower will need to provide the lender with proof of their address, income and identity. If this information meets the bank's criteria, the bank will go ahead and do a credit check. Applicants who are of working age, have sufficient income and a clean credit check will generally be approved for the loan.

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