1) Deposit – how much do you need?
When you start looking for a property to buy, you need to know how much money you have to spend. In general, the more money you have saved for your deposit, the wider the range of mortgages that will be available to you. A recent post on the which.co.uk website states that 5% is the minimum that a lender will accept as a deposit for a mortgage. Let’s have a look at a few reasons why saving a bit more would be a great thing to do:
- Lower mortgage repayments – in general, the bigger your deposit, the smaller your loan. The smaller your loan, the lower your monthly mortgage repayments will be!
- Lower risk – if you own more of your property, the lower the change you will fall into ‘negative equity’ – owing more on your mortgage than your home is worth.
- Probability of a much better mortgage deal – a mortgage lender is lending you money that they are hoping will make them money. You will be of lower risk to them with a larger deposit, you they are more likely to offer you a mortgage with lower interest rates.
- More mortgage options – If you have a larger deposit and appear to be a lower risk lender, more companies may offer you a mortgage deal, as you are more likely to cost or lose them money!
2) Know your figures!
When you buy a home it is not just the mortgage you will have to pay. You will also need to budget for a whole selection of fees:
- Removal fees
- Mortgage set-up fees
- Valuation fees
- Stamp duty
- Solicitor’s fee
Here at YesCanDo, we pride ourselves on our customer care and support. Our mortgage brokers and other financial advisers are trained and ready to assist you with any questions you have when it comes to fess and budget planning for home purchases.
When you apply for a mortgage there are strict checks that you will be able to afford to pay it. There will also be questions asked by the lender to test how you might be able to afford your mortgage if your circumstances change – if you are made redundant for example.
3) Finding the right Mortgage for you
This is a big one! There are so many options out there and can be very confusing. Here at YesCanDo money, we give honest, straight-forward, and easy to understand financial advice. We take care of all the administration for mortgages as well as liaising with estate agents, mortgage lenders and solicitors to make sure the process is as smooth and hassle free for you as possible. Our mortgage brokers will find the best deal for YOU! Being an independent business, we work how we think we would like to be treated ourselves – call us today to book a daytime or evening appointment at either our office or your home. We don’t think that that is an offer you will see many other places!
4) Applying for a mortgage
When you apply for a mortgage, your lender will want to know as much as you can tell them about your financial situation. Interest rates rise and falls, how can you prove that you can cover the change in your mortgage cost should something happen? You will firstly need to prove your income; producing pay slips and bank statements. If you are self-employed, you will need to provide tax returns and your yearly accounts. You will also need to tell your lender about your outgoings and any debts that you may have. This includes household bills, direct debits, childcare and travel costs.
5) Have everything in place to make the move!
Firstly, let’s just say that you should never rush into buying your first home. However, having all of your finances in place before you start looking for a property will mean that you can jump on a property if it’s the one with you. You may even be able to get the property for a better price if you can tell the vendor that you have everything in place and are all ready to go!