Purchasing a home is a significant milestone in anyone’s life which can feel daunting task, especially if it’s your first time. The UK housing market can be competitive, so it’s important to be prepared and well-informed before making a significant investment.
Here are some tips to help home buyers be in the best shape when taking their first steps on the property ladder:
Your Credit Score
A good credit score is crucial when applying for a mortgage. Make sure your bills are paid on time and reducing outstanding debts will improve your credit score. This will increase your chances of being approved for a mortgage and getting a better interest rate.
Having no credit can be as limiting as having a poor credit record. You can improve your credit score by demonstrating good money management, e.g., using a credit card for fuel and clearing the full balance monthly.
Different Types of Mortgages
There are many different types of mortgages available in the UK, from fixed-rate, variable, tracker, and discount rate mortgages. It’s essential to understand the pros and cons of each option and compare rates from different lenders. A mortgage broker or financial advisor can help you navigate this process.
Living Costs
When looking for a home, it’s important to consider the cost of living in the area. Property taxes, insurance and utilities can vary from one location to another. Make sure you are financially comfortable with any additional costs associated with owning a home in your desired location.
Protecting Your Home
Factor in the cost of protecting your home in the event of unemployment, loss of earnings, critical illness, or death.
Survey
A survey is essential before purchasing a home to ensure there are no hidden issues that could cost you money in the future. A homebuyer report or full building survey can help identify any potential problems before you commit to buying the property. Any survey carried out by a lender is for their lending decision only and does not guarantee any structural issues of your dream home.
Professional Advice
Buying a home is a significant investment, and it’s essential to seek professional advice from a mortgage broker or financial advisor. They can help you understand the process and ensure that you are making an informed decision. Make sure the adviser and firm you are talking to are registered on the FCA directory.
Reputable Solicitor
Choosing a mortgage product with a fee-free solicitor is not always the best option. Find a solicitor who is reputable and research recommendations, your mortgage broker will provide guidance, also bear in mind a fee-free solicitor will typically not offer a face-to-face solution.
Be Prepared to Move Quickly
The UK housing market can be competitive, and it’s essential to be in a position to move quickly when you find a property you like. Having financing in place and being ready to make an offer can increase your chances of getting your desired home. Most lenders offer a Decision in Principle service that does not affect your credit file but allows sellers to be confident you can raise the necessary funds. Remember you do not have to use Estate Agent based advisers.
Government-Backed Schemes
The UK government offers several schemes to assist first-time home buyers with making the process more affordable. While the Help to Buy scheme is no longer available to new applicants, the Right to Buy, Shared Ownership and Help to Build schemes can help make buying a home more accessible.
Buying a property is a significant investment, and it’s essential to be prepared and well informed before taking the leap. By following these tips, first-time home buyers can navigate the process with confidence and make an informed decision.
Remember that it’s always a good idea to seek professional advice, whether it’s from a financial advisor, a solicitor who can guide you through the legal aspect, or from one of our own mortgage experts who are ready to help guide you through this important journey.
Click here to find out more on how we can help support first time home buyers or give one of our experts a call on 01202 850 830 for a no-obligation chat.
And don’t forget, it is always advisable to seek independent advice when dealing with financial issues.
Please remember that your home may be repossessed if you do not keep up repayments on your mortgage.