Being a First Time Buyer can be an exciting – if a little scary – time. As new starters in the area of property ownership and property finance may mean that you are not quite as well versed with some of the key points to look out for and be aware of as you make tracks to owning your first home.
In addition to seeking out expert financial advice through the use of your One 77 adviser, we have collated a few handy hints and tips to keep in mind as you take your first steps on the property ladder.
1. Get familiar with your credit score
The importance of having a good credit score, especially as a First Time Buyer, cannot be underestimated. Lenders will always require to see this, so having knowledge of how your credit report looks prior to them doing so is always worthwhile, and may stop any nasty surprises. There are a number of providers that allow you to do this; from Experian and Equifax to Noddle. By checking your report you will get a good indication on how to improve your score. Sometimes, these can be fairly quick and easy wins: such as ensuring you are on the electoral register and making sure any cleared or unused credit cards or accounts are closed down.
2. Pay off as much debt as you can
When your lender receives your mortgage application and credit report they will be able to see your current financial standing, so any amounts left on credit cards or hire purchase agreements will become visible. This will have an effect on your affordability – the amount of money you have left each month in order to make your mortgage payments. In essence, the less debts and outgoings you have, the more you may be able to borrow.
3. How large is your deposit?
It probably comes as no surprise that the more money you have available to put down as a deposit on your new house, the lower the repayments will become and therefore the choice of products available to you grows. Though it may seem an arduous task to save for a larger deposit, in the long run the savings to be made will make it all worthwhile.
4. Incomings, outgoings and affordability
We would always advise that before getting your hopes up and starting the journey towards a mortgage application that you take the time to sit down and work out your finances to see how comfortable they sit with you. Work out your incomings and outgoings and then see how much would be left for mortgage payments, whilst also taking into account your day to day living costs (which your lender will do). You can then get a rough indication of how much you may be able to borrow by using our mortgage calculator. If it is all looking good – give us a call.
5. Are you in a stable position?
When applying for a mortgage it is not just your finances that come into question from lenders. It is also your reliability to continue to bring in a wage that can pay your mortgage. Therefore, if you are looking to change career or move jobs, it may be worth holding out until you are in your new home. Lenders will want to see around at least 6 months of stable employment on the application they receive. This shows them that you are a stable and reliable applicant.
6. Keep all documentation
All lenders will need proof of income. Always keep hold of your payslips and P60 documents. These are what lenders will ask for to clarify that the amount they are lending affordable for you. In addition to your employment documents, remember that at least three months’ bank statements will also be required. This will again clarify your incomings and outgoings mentioned above.
7. Start with a goal and stick to it
To ensure that your application proceeds swiftly and without any issues, make sure that you are on track with a single vision from start to finish. Once under-way it is important not to change any of the details of the application in order to ensure the case is dealt with promptly. Try not to change your lending amounts and ensure that all outgoings are declared in full from the outset.
8. Speak to an adviser
We have years of experience in mortgages and helping clients find the best deal for their circumstances – whether for a First Time Buyer, a remortgage client, or someone looking for specialist finance. Rather than approach a lender directly, always check with our team of knowledgeable, dedicated advisers as we have access to many lenders and products that are not available on the high street. As we are a fee free mortgage brokerage we will never charge you a penny for our advice and services.
Are you a First Time Buyer? Call us today on 01249 474952 or use the contact form below to tell us when is a good time to call you. At One 77 you always come first – start your journey with us.