Buying a house can be a daunting yet exciting experience. House purchases rarely stick to the expected time frames and it might take you several months to find your ideal property. Not to mention the transaction can be time-consuming as well.
Buying a house is a big commitment, it should take a lot of consideration so it is important not to rush. Here are five great tips to help you get on the property ladder and buy your first home.
Research
You should always ensure that you have thoroughly researched which areas you can afford to buy-in. As well as consider the type of property you’re looking for before you start your search.
While you can find out a lot about a place online, you only really get the feel of a place by visiting it. Check out the immediate area to see if the property is on a noisy road, or close to a railway line. Have a good walk around the streets and spend time in the local shops, cafes and restaurants talking to people who live there and who know the area well. If you are planning on bringing a family up in the future it’s worth finding out about the local amenities such as schools, doctors surgeries and sports clubs.
Unless you are in the position to buy a property with cash, you are going to need a mortgage. A mortgage is a loan from a bank or building society against a property in which the borrower has to pay back the loan in addition to accrued interest. With multiple different lending options, which depend on various factors, for most first-time buyers and the more research on this subject you do, the better.
Get a Home Inspection
As a first time buyer, it’s easy to get excited about the prospect of owning your own home and get caught up in looking for the perfect looking house.
A new house can come with some baggage. Each house is different, some age well and others may come with some crinkles that need to be ironed out. Not all visible on the surface. That is why it’s really helpful to get an expert on board to help you better understand your situation.
An inspector will look at the safety, operation and condition of the house, providing a report that examines the foundation, including the electrical system, plumbing, insulation, heating, cooling and much more. This helps you make an educated decision on whether this house is for you, saving you money on repairs and renovations in the long run.
Not only does this stop you from running into any surprises when you own the home, but it can also help you to negotiate a better deal upfront as well as to better understand the maintenance needs of the home once the sale has gone through.
There is no such thing as a perfect house but working with the team at Brightside Home Inspections will make sure that you have the necessary information to find the right house for you.
Start Saving
The bigger the deposit you have, the lower your interest rate, this means that your monthly payments will be more affordable. Different lenders have different requirements but you should aim for a minimum of 10%, although aiming for a 20% deposit will allow you to access much better deals.
It isn’t just the deposit you need to think about, buying a house comes with legal fees. It is best to get this done professionally, the legal team will draw up the contract, deal with the Land Registry as well as manage Stamp Duty charges. Other costs to consider are removal fees, cleaning fees, plus you want to have a little left over so that you can decorate your new home.
Once you know the amount of deposit you’ll need, make a plan to reach this goal. Be realistic about how much you can afford as well as how much you can save each month. Regular saving is more effective than relying on irregular one-off sums.
One way of doing this is by setting up a direct debit from your current account to your savings account. The automatic transfer can make sure your savings steadily build up. If you think you might dip into your savings, consider an account which often won’t allow you to make withdrawals without the bank’s permission or until a set date.
Work Out Your Budget
There’s nothing worse than falling in love with a property or an area that’s simply out of your budget. That is why it is important to understand your budget, at the start of your house hunt. It will also help you in securing a mortgage offer, which shows the sellers that you’re an attractive buyer with your finances already in place.
By analysing your income and outgoings, it can help you identify areas where you can cut spending. Cutting back on the small things make a difference each month. By taking notice of how much you are spending on those little luxuries like coffee each day, takeaways and Ubers, you can make adjustments accordingly.
When taking the time to analyse your budget, it’s a great idea to do your research and look at switching to a cheaper provider on things like your gas and electricity and car insurance. This can be a great way to save money without having to cut back or make any lifestyle changes.
Once you have worked out your budget, you are able to find out how much you can borrow and comfortably pay back each month. It’s time to start house hunting.
While you can find out a lot about a place online, you only really get the feel of a place by visiting it. Check out the immediate area to see if the property is on a noisy road, or close to a railway line. Have a good walk around the streets and spend time in the local shops, cafes, and restaurants talking to people who live there and who know the area well. If you are planning on bringing a family up in the future, it’s worth finding out about the local amenities such as schools, doctors’ surgeries, and sports clubs. Additionally, if you’re concerned about affordability, you can explore programs like Zillow’s 1% down payment program to make your home purchase more budget-friendly.
Check Your Credit
Having a healthy credit history is essential when it comes to finding a mortgage.
There are many platforms where you can request a report of your outstanding credit as well as your credit history. It shows your credit cards, mobile phones, gas, electricity all in one place.
It’s important to do a thorough check that the information is correct. If you notice any errors it’s best to contact the lender and liaise with them to correct the mistake. Keep in mind you will need proof that an error has been made.
If you’ve never borrowed before, it’s a good idea to take out a credit card and pay off the balance in full each month. This helps you prove to lenders that you’ve got a track record of successfully repaying debts.
