4 Simple Tips For First-Time Buyers Of A Home Mortgage

Want some tips to help you get the best mortgage deal as a first-time buyer? Buying your first home is a huge step to take, and it’s important that you get it right, so read on to discover our tips for finding the right mortgage.

Improve your credit rating

In the lead up to applying for a mortgage do all you can to improve your credit rating; there are simple steps you can take to boost your chances of getting a mortgage. Firstly, make sure that all of your paperwork is up-to-date with your current address and that you’re on the electoral register too. Clear as much of your debt as you can and close down any inactive bank accounts. If you don’t have a credit history, then consider taking out a credit card. Money Saving Expert has a free guide for first-time home buyers that will take you through the steps you can take to improve your credit rating and increase your chances of being accepted for a mortgage.  

The bigger the deposit, the better

The motto of this story is to save, save and save some more. The bigger the deposit you can put together, the greater range of mortgages you’ll have to choose from and the better the mortgage deal you can expect to get. Moreover, the greater the percentage of the purchase price you can afford to put down, the more secure your house purchase will be and the greater the buffer you’ll have against negative equity.    

Understand your budget

It’s also important to understand what you can expect to borrow. There are lots of online mortgage calculators that will help you get an idea of what you’re likely to be able to borrow. However, be careful not to overstretch yourself and ensure you can afford your mortgage payments, as if you don’t keep your payments up-to-date you could risk losing your home. For first-time buyers mortgage advice speak to an experienced mortgage adviser to find the right mortgage deal for you and to guide you through the process of applying for your first mortgage.

Be aware of additional fees

When buying your first home, you’ll face some additional fees, some of which are one-off expenses, whilst others will be ongoing. It’s important that you have a realistic understanding of all of your expenditures so that you can budget accurately.  You may incur an arrangement fee for your mortgage, you’ll also have conveyancing fees to pay, and if your property is worth over £125,000, you’ll have stamp duty too. If you’re buying a new-build home, look out for deals that include the payment of your stamp duty.

Looking forward, remember that leasehold properties often incur additional fees such as maintenance, service charges and ground rent. If you do have to pay maintenance fees, ask if you’ll be asked to pay for the day-to-day maintenance or be held responsible for more substantial maintenance costs. Having an accurate idea of the full range of fees you’ll incur, will give you the best chance of planning for and meeting your future financial responsibilities. If you can, put some emergency funds aside too for unexpected eventualities.  

So there you have our hints and tips for finding the right mortgage for you as a first-time buyer, we hope you’ve found it helpful.

Anum Yoon is the founder and editor of Current on Currency. She loves all things personal finance, which is why you'll find her work all over the PF blogosphere.

Read more:
How Buying A House Is Different In The 21st Century

Home buying is changing. Sure mortgages and foreclosures will still be around, but what is changing...