Many first time buyers may find they struggle to get a decent rate on their mortgage based on their credit ratings. As individuals that may have always paid cash and never had credit, they subsequently find themselves declined as this has meant they have had no traceable record of being able to maintain a financial arrangement.
Steps to help you along the way…
1. Know Your Credit!
Did you know, some insurance companies actually arrange finance with external companies for pay monthly policies?
If these are not declared with some lenders this could cause a decline.
2. Manage Your Money
Though this may sound like an obvious one, it is surprisingly easy to fall behind. Budget planning can be a life saver – you can download our Budget Planner HERE!
Set up a separate account for your bills, with a standing order to ensure there is always enough money being available to cover them.
3. Don’t Be Afraid To Take Finance
If you are unsure as to how a finance agreement works – ask!
If the person selling it cannot explain it in terms you understand, is it the right one for you? A classic example of this car finance – PCP? HP? Balloon Payment? So many options!
4. Things You Can Do To Improve Your Rating
a) Register to vote – this increases the “paper trail” that confirms where you live. Many lenders have a 3 year address requirement. Can you prove yours?
b) Set up Direct Debits on credit cards for the minimum payment so you never miss a month – then make an additional payment. This shows up as TWO payments to the account, therefore boosting your profile.
c) No rating? Go to your bank and ask what they can offer you. Many have internal scoring systems based on your ‘direct’ relationship with them.
Most of all, remember – there’s no such thing as free money!
To discuss your mortgage and protection requirements today contact me,
Mortgage and Protection Adviser