29 Mar 2022
Struggling To Save For a Mortgage? Here’s What Can Help
Hoping to buy your first home but struggling to save for a mortgage?
With house prices on the up, it’s no surprise that even more people are wondering whether a mortgage is possible.
But from government schemes to knowing what to avoid, there are certain things you can do to boost your chances of bagging a great deal.
At Mortgages Online, we have a range of online mortgage brokers and mortgage experts on hand to provide advice, as well as specialist lenders who can offer a mortgage no matter your financial situation. Get in touch with us on 03300 58 60 58 to discuss your options – we’d be happy to help.
What is a Mortgage Deposit?
When purchasing a house, you have to pay a certain amount up-front known as a deposit. Usually at least 10% of the overall cost is required, but the higher the deposit the better your mortgage application will look.
Improve Your Credit Score
Before you start the mortgage process, making sure your credit score is at its best is your first step to getting the best deal possible.
Do what you can to improve your score, such as getting on the electoral roll, closing unused credit accounts and more.
Read on: A Guide to Improving Your Credit Score Rating
Speak To an Online Mortgage Broker
If you’re having trouble saving for a deposit, your next port of call would be to contact a mortgage broker. Their industry knowledge and expertise allows them to look at your specific financial circumstances, locating the ideal mortgage for you. They can also answer any questions you have to help you understand the mortgage process, this is especially helpful for first-time buyers.
An online mortgage broker has access to many more lenders than your local high street bank, meaning more mortgage choice for you. And with more choice, that means more flexibility for you.
They will also have lenders on their books who are happy to offer mortgages to those in difficult financial situations. So if you’re struggling with a deposit, an online mortgage broker will be able to help you find a lender willing to accept a lower deposit than normal.
If you need help from an online mortgage broker, get in touch with us in 03300 58 60 58 or email us at ask@mortgages.online.
Government Schemes
There are a range of government schemes out there for first-time buyers to take advantage of. They aim to help people on the property ladder by decreasing the amount of deposit needed.
Help to Buy
First-time buyer? You’re eligible for a help to buy mortgage. This type of mortgage is especially helpful for people who are struggling to save up for a deposit as only 5% is required. The first help to buy scheme is closed, but there is a new help to buy equity loan which opened in 2021 and will be available until 2023.
Lifetime ISA
First-time buyers are also eligible to set up a Lifetime ISA account. With this, the government will add 25% to your savings, with a maximum bonus on £1,000 per year if you save up to £4,000 per year.
Read on: Lifetime ISA or Help to Buy ISA?
Shared Ownership
If you’re struggling with a mortgage, shared ownership allows you to buy part of a new-build and pay rent on the rest. You can increase your share as soon as you’re financially able.
What To Avoid Doing When Saving for a Mortgage
To increase your chances of getting accepted, there are certain things you should avoid doing. From being in debt to errors on your application, making sure to follow the process correctly will make a significant difference to your success.
Avoid Changing Jobs
Mortgage lenders like to see financial stability, so if you’re planning on changing jobs it’s important to wait until after you get your mortgage confirmed. Ideally, they’d want to see you’ve been in your job for at least 3 to 6 months.
For the self-employed, mortgage advisors would like to see at least a years’ worth of accounts. So if you’re new to the self-employed world, you might want to get your accounts in order before applying for a mortgage.
Don’t Ignore Your Credit Score
Before applying for a mortgage, make sure to check your credit score. It can determine whether you get accepted for a mortgage or not.
The lower your score, the less likely you are to get accepted for a mortgage. However, there are specialist lenders out there who regularly deal with people in adverse credit and with low credit profiles. If you require advice or need help finding a bad credit mortgage, we can help you at Mortgages Online.
Avoid Debt
Being in debt will negatively affect your credit score, decreasing your chances of getting accepted for a mortgage. Most mortgage lenders will want to see that you are reliable with money, and debt will do the opposite of this.
If you are in debt, make it a priority to pay this off before applying for a mortgage. If this isn’t possible, there are bad credit mortgages and specialist lenders who will be willing to help you with a mortgage despite your low credit score. Online mortgage brokers, like Mortgages Online, will have access to these types of lenders, so get in touch to find more.
Avoid Rushing Your Application
When applying for a mortgage, take your time on your application. Everything will be checked, so mistakes and errors on your profile will only prolong the process.
Find Your Dream Home
Saving for a mortgage can be difficult, but if you know what to avoid and make use of government schemes whilst doing your best to save what you can, there’s no reason why an online mortgage broker can’t find a mortgage deal suited to you.
If you’d like our help finding a mortgage, don’t hesitate to get in touch with a member of the team by calling 03300 58 60 58 or emailing us at ask@mortgages.online.
