Buying your first home and getting on the property ladder can be a daunting task but with our Top 5 Tips we hope to make this process a lot simpler for you.
1 – Get your finances in order
When getting a mortgage you will want your finances to be at their best, so you look like the perfect applicant to a lender. To do this you need to:
- Check your credit score regularly as this gives a clear view of how the financial world sees you when you make applications
- Ensure you are registered on the electoral roll at your current address
- Review your current lending. Having little or no credit history can negatively affect your credit score. Any credit cards/loans you have need to be paid regularly and on time to show you can manage your finances.
Review Experian’s top 10 tips on improving your credit score here
2 – Know your budget
You will require a deposit of at least 10% with most lenders but in the UK there is support available with the Help to buy scheme which can allow you to put in as little as 5% deposit and the government will the remaining deposit.
We recommend you review your bank account and current expenses, then remove any unused Direct Debits set up and make savings by cancelling any unused or unnecessary subscription.
Now you know how much you currently pay out on existing expenses; you can work out how much can you afford to put towards monthly payments each month.
Our affordability calculator will help you find out what real lenders could offer you in just 10 minutes.
3- The search
When looking for your new home, think how long you would like to live in this home and then consider its location, size, price and does it require any work when you move in…have you factored the renovation/décor costs into your finances?
Picking the right house at the right price is a big decision as you don’t want to stretch yourself on the purchase and then not have enough to pay bills or renovations when you are in.
4 – Speak to an adviser
It can be very overwhelming to get started with the mortgage side of buying a house.
A mortgage adviser will do the hard work for you through each stage of the process, from:
- Mortgage applications
- Instructing Valuations
- ‘Decision in principle’ (DIP)
- ‘Key Facts Illustrations’ (KFIs)
- Help choosing a Mortgage Product
- Mortgage offers
An Adviser will help you avoid the stress and means you don’t have to juggle the jargon. Get in contact with our adviser today for a free consultation.
5 – Protect yourself
A mortgage will be one of if not THE biggest purchase you will make in your lifetime, make sure you protect yourself and take out Life/Critical illness insurance, this will helps protect your loved ones financially if the worst were to happen or you get ill. Your family will get a cash lump sum they can use to cover costs such as the mortgage, funeral expenses, debts or household bills.
Written by Jon Williams DipFA CeMAP, IFA at Beesure Ltd