Buying property is always a big commitment, and getting onto the property ladder can feel overwhelming. Fortunately, with careful planning and a good understanding of the process, it is possible to buy your own property and invest in your future. 

In this blog, we look at what you need to know before you buy your first home.

Plan ahead to increase your chances of getting a mortgage

Improve your credit rating

Before you even start looking at property or putting your income into a mortgage calculator, there are a few early steps you could be taking. If your credit rating is not very good, do what you can to improve it before approaching a mortgage lender. For example, making payments by direct debit means that you avoid getting behind with bills, and paying more upfront and less on your credit card shows that you’re a responsible shopper. 

Consider how your spending looks to lenders

A mortgage lender will also want to see bank statements and look at where you spend your money. Spending on frequent holidays or luxury items may give mortgage lenders the impression that your lifestyle is more important than your financial obligations. In addition, holidays and treats could seriously eat into your savings. However, being more frugal while you save your deposit and secure your mortgage will be worth it in the end. Keep your eye on the prize! 

Ask about a mortgage in principle

You can also approach a mortgage lender and ask for a mortgage in principle. This is when the lender looks at your income and agrees to lend on the condition that your income doesn’t drastically change. A MIP can be very useful as it means you’re ready to go when you see a property you want to offer for. 

Do your maths and work out what you can afford

When you’re buying your first home, you should calculate the following expenses and consider them against your income.

House deposits

A house deposit is usually a minimum of 5% of the price of the property – ideally more. For example, if you want to buy a £200,000 property, you will need to save at least £10,000 to put down as a deposit. Remember that the bigger the deposit you can put down, the better your chance of securing a mortgage at a good rate of interest. 

Mortgage repayments

You will pay back your mortgage in monthly instalments and there are lots of mortgage calculators online to help you plan ahead. With these tools, you can put in your income and the rough price of the house you’d like to buy, and it will tell you how much your monthly repayments are likely to be. 

Insurance

Most mortgage lenders will want you to take out buildings insurance so that if anything happens to the property, they have not lost their investment in it. Lenders will often want you to take out life insurance as well, to ensure that the mortgage repayments are kept up even if you are unable to work.  Both these types of insurance will come with monthly premiums which are important to bear in mind. 

Conveyancing

You will have to pay a conveyancing solicitor who will handle your property purchase. This usually costs upwards of £1000 but unless you’re a property expert, it’s money well spent! This is not a transaction most people can do themselves and it’s better to leave it to the experts. Find out more about conveyancing here.

Ongoing maintenance

While your mortgage repayments will probably be less than rent, you must remember that the responsibility for the property will be all yours. This means that you will have to cover the cost of repairs and maintenance to the home you own, so remember to factor this into your calculations.

Buy your first home in Guildford

The Cobbles team love supporting first time buyers and our friendly team are here to help! We hope you’ll explore our site and find the right property for you. When you’re ready, get in touch on 01483 457 000 to ask any questions about buying your first home or even book a viewing.