Getting onto the property ladder is a crucial step that many in today’s economic climate are finding difficult to achieve. As outlined in our article on Sunday 13th October, prospective buyers believe that Help to Buy interest rates are too high. At a time when buying a house is often cheaper than renting, we look at what first time buyers should be considering.
- Area
A whole host of things can influence a decision about where to live, including work commitments, friends, family and financial restrictions. Before first time buyers start looking or begin to make any enquiries, research into available options should be made. A bigger mortgage on a home closer to work isn’t necessarily a bad thing, as it also means less money spent on commuting.
- Debts
The smallest black mark on a credit report can lead to a mortgage application being rejected – a couple were deemed as too ‘high risk’ in August over a £10 mobile phone bill error – so it’s vital that payments are up to date.
- Government Schemes
The government is working pretty hard at the moment to help first time buyers get onto the property ladder and there are lots of schemes about that can help first time buyers to take that first step. The Help to Buy scheme is a really popular option at the moment, but there are plenty of other schemes such as shared ownership around as well.
- Savings
Even with a help scheme, first time buyers will likely need to offer at least 5% of the property’s price up front as a deposit. The bigger the deposit, the better the mortgage deal will be. Re-budgeting in order to build up the best lump sum possible is essential for the best deal.
- Mortgage
There are lots of different mortgage providers out there and figuring out which one offers the best mortgage is a crucial consideration. The size of a deposit will affect mortgage repayments.
A bank with a more local style of operating will likely be a selling point for first time buyers. With community at the heart of its ethos, it will be recognised that the more people bank with their local, the more TSB will be able to lend to households and businesses in the community. It’s a method that’s been working well for over 200 years and the video below explains all about it.
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