So, you’re thinking of buying a first home soon. Great news. But it’s important to take some steps in securing a mortgage for the first time.
Naturally, you may imagine yourself moving into a funky, contemporary city apartment or maybe one with loads of space. Unfortunately, the reality isn’t quite so glossy. The property you move into will largely depend on what funds you have available, not forgetting the initial steps you take to secure finance to buy your home.
Of course, arranging an appointment with a mortgage advisor is important but so is thinking ahead. By this, we mean investing some time in advance to organise your finances. By planning ahead, this will demonstrate your sensible attitude to money matters as well as make you more eligible for a mortgage.
What Are Your Monthly Expenses?
Think about what you pay out each month. Are you paying too much for your mobile phone contract, for a gym membership or car insurance? Can you cut down on other expenses, such as monthly magazine memberships or other such items?
Keep an Eye on What You’re Spending
When it comes to the mortgage appointment, you’ll need to present in-depth info on what your expenditure is.
Is there any way you can cut your monthly payments? Which payments are you financially committed to? To enhance your credit rating, consider setting up direct debits on any frequent monthly expenses, like utility bills and credit cards. And ensure you’re on the electoral roll, as this will help lenders when carrying out checks such as this.
When you buy a property, not only do you have to fork out for a deposit and monthly payments, but you’ll have to think about paying the additional costs of owning a home. So, now’s the time to save as much as you can to account for these expenses. You could even practice saving for these extra costs in the run up to buying the new house, and have the additional expenses coming out of your bank account every month.
Although difficult at first, you could set up a savings account that doesn’t give you access to savings – it’s perfect if you want to stop yourself from spending and will also help make you more conscious about what you’re spending your hard-earned cash on.
Make sure you look over your bank account regularly and try and ascertain if there are any unnecessary high costs for items like clothing, food or entertainment and try to make savings where possible.
Make sure you schedule your mortgage appointment well before you’ve found the perfect property. Gaining final lender approval to a loan can take quite several weeks. You might want to think about heading to a company who can provide professional mortgage advice, and one who has access to a variety of mortgage deals. It may be the case that high-street mortgage lenders can offer you more choice than some lenders who have only their own products.
Prior to your appointment, make sure you bring all the documentation you need, as you’ll need this to support your mortgage application. You’ll need several papers to hand, including your proof of identity, payslips, employer details, bank statements, to name just a few.
Get together with your parents, friends or relatives and talk to them about what they did when it came to getting a mortgage. From this, you should be able to gauge what’s important to you in terms of your own mortgage. Think about how long you want to live in the home, if you’d be looking to find another mortgage on another property in a few years’ time, or even sell your property quickly for cash in the future. Think about whether you’d like a mortgage where you:
Although taking the first step onto the property ladder may seem scary, with a bit of forward planning, it needn’t be as daunting as you first thought.
We offer free 'Whole of the Market' mortgage advice at all of our branches. Contact Us for more information.