The Problems of a First Time Buyer Mortgage: and How to Avoid Them
Part of generation Y, Z or a Millennial? Then it’s probably high time you started looking for your own home. You can’t live with your family forever – although endless washes and cooked meals does sounds appealing… But, no, it’s time to think about moving on.
When it’s time to buy your first place, there’s a few common mistakes all first-time buyers make. But, hey, it’s your first time – you’re not supposed to know what you’re doing. Luckily for you, we’re the experts on mortgages, so we know all the common mistakes first-time buyers make.
This week on MO’s article, we’ll be looking at the top 5 first time buyer problems, and how to avoid making first-time mistakes.
1. Not Researching
Your buying journey typically starts with seeing your dream house. That first glance at the beauty of your potential first home – and then it’s shattered by the lack of ‘For Sale’ sign outside the front. You may feel discouraged, but now is the time to start researching properties. The key mistake first-time buyers make is that they don’t carry out enough research before they look for their first house. You need to consider house prices, the area you want to buy in and what sort of deal you can get on a mortgage too. You can’t go into something like this blind, when you’re spending big money. Make sure you do your homework before looking for a property
2. Not the Right Time
There’s a right and wrong time to buy your first home. Believe it or not, it is dependent on timing. This is where your research needs to extend, and you need to look into varying factors before buying your first home. There’s different aspects that you should think of as a buyer, is it the right time in the housing market? Are you getting the best price for a property? Before you even think about buying, think about if it’s the right time. Remember, the process can take time – especially if you’re caught in a buying chain. So, patience is key when buying your first home.
3. Not Enough Deposit
Another spanner in the works of buying a home is not having enough for a deposit. Whilst many may think that you need a 10% deposit, it’s not true. You can have a minimum of 5% when applying for a mortgage, although it does somewhat limit your options. The safest option is to try and save as much as you can. This benefits you in the long run and means that you’ll get better mortgage rates too. You shouldn’t rush into buying your first home, so save if you can for the best deals. Make sure you have enough deposit in your bank account or savings account!
4. Not Checking your Credit Score
Your credit score is a determining factor in being approved for a mortgage. What happens when you have the deposit, the right property and it’s the right time, but you don’t have the right credit score? You’ll be rejected from your mortgage. You need a good credit score to get the best rates for a mortgage, and, as we’ve said, you should never go in blind. Make sure you look at your credit report and score, so you know where you stand. It can derail your chances of landing yourself a mortgage for your new home. There’s plenty of free credit score checking sites online, such as Clear Score and Noddle. Use these to find out what your credit is like and see what kind of deal you can get on a mortgage. Speaking of mortgages…
5. Not finding the right Mortgage
Finally, a problem that you’ll probably face as a first-time buyer is finding the right mortgage for you. Whilst you can have the house, the deposit and the right credit, it means nothing without a mortgage to back your property purchase. However, fear not – you’re in the right place. At MO we’ll find the best mortgage for you. All you need to do, is put your details into our site and we’ll come up with a list of mortgages that we can offer you. We have a team of advisors at the ready to tell you which mortgage is best for you. It’s that easy. Hey, we'll even be able to quote you for life insurance too, another reason to use MO.
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