Hoping to start the next chapter in your life? Joining the property ladder by buying your first home can begin a fresh start. Buying the first home that you get to call your own, decorating it in the style that you love and leaving your mark.
As the number of first-time buyers reaches its peak, getting onto the property ladder is becoming a mission many want to accomplish. If you are in a position where you feel ready to get your foot onto the property ladder, here are a few ways you can prepare for buying your first home.
Begin Saving Early
Buying a house is an investment. It is one of the most significant investments a person will make. From the moment you consider buying a house, and sometime before, begin saving. Start building up healthy savings that you can use to help you buy a home.
One of the biggest payments you will make is the mortgage deposit. The average amount you need to save for a mortgage deposit is about 5% of the property’s price. You can put down a larger deposit to help you get more competitive mortgage deals with lower interest rates.
Aside from the mortgage, a few additional costs are involved. There are closing costs, legal fees and moving expenses after the property sale is completed. Ensure that you have built up substantial savings that will help you cover all of these costs, with a little extra in case it is needed.
Research What You Can Borrow
The mortgage options available to you will depend on various factors the mortgage provider will look at. Two main factors they check are the size of your deposit and your monthly income. These factors show them that you have the funds to pay back the mortgage and are a reliable candidate. One of the other factors they consider is your credit score. Those with a good credit score are more likely to get a loan with reasonable rates than those with a bad credit score. A person’s credit score is another indicator for a mortgage provider about whether a person is likely to be able to pay back what they owe.
If you find yourself with bad credit, there are ways to improve it. One way is to reduce the size of any debt you have. Removing these shows lenders that you are actively trying to reduce the debt. You may even look to cancel any outgoing payments to subscriptions and services that you hardly use. Another option is working with specialist bad credit mortgage brokers. You might consider working with companies like Money Nest. These mortgage brokers for bad credit help you find specialist lenders who will likely work with you, despite the bad credit you may find yourself in.
Consider all the options available when finding out how much you can borrow and from whom. As you will be making these payments back after finding a house, you want to ensure that you have chosen wisely.
Look At Neighbourhoods
The area of a property can play an influential role in the house buying process. If you want to be in an area close to the city with solid transport links and amenities, a house in the countryside might not be the ideal match. Spend some time researching the areas you are considering. Look at the types of properties in the area and what kinds of homes you could get in your budget.
Commonly, the first house a person buys is not their forever home. When looking for your first home, consider if the property is resalable. Consider how long the property has been on the market. This can indicate that the property is not in the most favoured area or has issues with the house. Keep this in mind if you plan to sell the property.
Book Property Tours
Viewing a property photo and seeing it in person can provide two vastly different opinions of the house. You will likely find homes you love or are interested in online, but you might not have the same feelings in person. Booking a property tour can help you better understand the house and the space that is or isn’t available.
Invest In A House Survey
Investing in a house survey is worthwhile if you find a property you love. Although you might not notice anything wrong with the property, aside from a few marks and holes, there might be underlying issues you cannot see. A house survey will uncover these and notify you of any problems that could be costly if not resolved. Any issues found could work in your favour. You could try to ask for the price to be dropped or have the current owners fix the problem. If neither happens and you do not want to invest in repairing the property, you can continue searching for your first home.
As you look to join the property ladder, utilise all the resources available to help you buy a house. The process can be complicated, so seek support and ask those you know for guidance. Keep some of these tips in mind to help you with house buying. Before you know it, you will be on the property ladder and slowly climbing it.