stepping onto the property ladder
A few things you should know about buying your first home
Keen to buy your first property? It’s a bit of a tricky time at the moment for first-time buyers. As you can imagine, due to the pandemic, mortgage lenders are a bit more wary about lending to people who they see as risky i.e. those with no mortgage equity or lower deposits. Unfortunately, this has resulted in 10% mortgages disappearing, meaning first-time buyers require a much larger deposit to secure a mortgage.
We understand you might be a little frustrated about having to wait until 10% mortgages re-enter the market and save even harder to increase your deposit, so here’s a list things that might help you in the meantime:
1) Improving your credit rating – If your credit rating isn’t perfect, use this time to improve it! Join the electoral roll if you haven’t already, use a credit card and pay it off on time, keep paying your bills on time and don’t make any further purchases on finance.
2) Limiting your spending – If you’re pretty eager to buy a property you won’t mind us being harsh when we say to stop wasting money on things like eating out, coffees and new clothes. Always think, ‘do I really need it?’ It’s too easy nowadays to use contactless payments, but those little things add up! Other than your petrol, food, and other essential costs, try being more careful about what you spend your money on.
3) Cutting costs – As you’ve already saved a chunk of your deposit, you probably have a separate savings account that you’re transferring to. So perhaps look at other areas where you could save money. If you’re currently renting, could you revise your utility bills and outgoings? Or perhaps you’re still living with Mum and Dad, do you have any memberships you’re not using, gym, cinema?
4) Getting more value for money – There are so many amazing schemes where you can get more value for your money: free supermarket clubcards, cashback schemes, voucher sites. If you have any family or friends’ birthdays coming up or there’s something you really want to buy, see if there’s any discount codes available online or cashback deals (it’s money for nothing!)
5) Breaking bad habits – You know what they are…smoking, drinking, gambling. These bad habits aren’t just bad for your wellbeing, but bad for your bank balance too! Another one is throwing out things you know longer need. It’s great to have a sort out but try putting items on Facebook marketplace or Ebay instead…that extra money can add up nicely.
Could you be more sensible with your money? We hope these hints and tricks have helped you to identify how to put yourself in a better position for when you are ready to make the big move!
If you have any questions about saving for a mortgage or obtaining your mortgage, please give us a call: 01633 987070.
