If you’re in the process of getting your first mortgage, then there are some factors that you should be aware of.
There are some tips that you need to follow to ensure that you are eligible for a mortgage in the first place. It is an extensive process but here is a quick beginner’s guide on how you can secure your first mortgage to help get you onto the property ladder.
Work Out Your Budget
It is important to note that although you may be able to borrow a certain amount of money for a mortgage, this doesn’t mean that you can necessarily afford the monthly payments if you were to opt for the maximum amount. It is crucial that you work out your budget before you decide how much you want to borrow. A mortgage calculator can be a great indicator in giving you an idea of how much a house could cost you each month. The worst thing you could do is overstretch yourself and end up in a stressful financial situation.
Know Your Options
Some people may lack confidence that they cannot get a mortgage, so they choose to explore other avenues like renting. However, it is important that you do your research and are aware of your options. For instance, many people aren’t aware that if you earn your income through a stipend that you can still get a mortgage as the options available are more limited. For anyone who is doing their PHD, stipend mortgages are certainly worth learning more about as they could help get you on the property ladder faster.
Stipend mortgages are just one example of the different types of mortgages available, so don’t be afraid to do your research and educate yourself on the options that you have.
Save For a Deposit
If your deposit is big then you are opening up your choices for a mortgage. Lenders tend to save the best rates for hefty deposits so if you aren’t serious about saving money then now is the time to start. Saving money can be difficult but there are steps that you can take to help. Check out this article on saving for a house deposit which offers some helpful advice. It is also important to note that a bigger deposit could help you lower your monthly payments so ask yourself, do you really need a takeaway this weekend? Or could you put that money into your deposit savings.
Be Wary of Your Credit Score
Your credit rating will be analysed by lenders during your application. If your credit score isn’t looking too good, then don’t be disheartened. There are a few ways that you can help to boost your credit score. For instance, if you have old credit cards that you no longer use then it is advised that you close these accounts. If you are not registered onto the electoral role then it is also harder to get accepted for credit so you should sign up to this immediately. Luckily, when it comes to boosting your credit score there is plenty of advice readily available to you online.