Mortgage Tips for First-Time Buyers

Buying your first home is a hugely exciting experience but the idea of applying for a mortgage is more likely to fill you with dread than butterflies.

Follow these simple mortgage advice tips and you will have the keys to your dream home in no time at all.

Stay in Your Current Job

Fed up with your job and looking for a change? It may be worth waiting until after you have secured your new home before you jump ship.

Securing a mortgage is all about proving that you are reliable and are financially stable. This will help convince mortgage providers that you will meet your repayments.

Most providers like to see commitment in your employment history and if you have been in the same role for at least 6 months then you will be in a much stronger position.

If you have just started a new job but have previously worked in a similar role for a significant period, then you may still be able to secure a mortgage however as you have a proven record of being successful in your profession.

Increase Your Deposit

Easy right? Well, even increasing your initial deposit by a small amount can have a huge impact.

Increasing the amount of money that you are willing to offer upfront for a property will increase your chances of getting a mortgage and can dramatically reduce the amount you have to pay each month.

Lenders view those with a small deposit as high risk meaning those who are able to offer more can secure lower interest rates.

You used to be able to secure mortgages with a deposit of just 5% however in recent years it is very unlikely that lenders will accept anything less than 10% and often require 15% or more from first-time buyers.

Get Some Help

Instantly increasing your deposit on your own is simply not an option for most first-time buyers, but do not despair.

Buying alongside someone else, whether a parent or someone else, can increase your chances of earning a decent mortgage especially if their credit history is better than your own.

If you are considering this option, you may well take joint responsibility for the mortgage and the property, so it is essential that the other person is aware of what they are committing to and that your relationship is not likely to change in the future.

Take Advantage of Government Schemes

Given the plummeting numbers of young people who are able to purchase their own home, the Government has introduced a few schemes aimed at making the property market more accessible.

A Lifetime ISA is an option available to first-time buyers looking to increase their deposit. If you are over 18 you can open a Lifetime ISA and put in up to £4000 per year. The Government will then top up your savings by 25% up to a maximum of £1000 per year.

This can be a great way to increase your chances of getting a mortgage as you will be able to offer a larger deposit when you wish to make an offer on a property.

You must be very sure that you are going to purchase your own home in the future before opening a Lifetime ISA however as there is a 25% charge for withdrawals made for any other reason than buying your first home.

Improve Your Credit Score

A good credit score will make you look like a great investment for a mortgage provider who will see that you are a responsible person to be lending money to.

If you are in debt or have been previously your credit score may be lower and you face a lower chance of securing a mortgage.

Simple ways to improve your credit score include registering for the electoral roll at your current address and taking out a credit card to purchase small items that you will be able to meet the repayment requirements for.

Talk to a Mortgage Broker

If you are serious about buying your first home, then talking to a mortgage advisor glasgow is vital. They will take you through what you can expect from your mortgage in terms of deposit and repayment schedule.

Not only can your broker advise you, but they will also arrange your mortgage for you once you have identified a property you are serious about.

By scouring the mortgage lender market, they will find you the best possible deal and explain exactly why they think that mortgage would be the best option for you.

Once you are content, they will submit your application and manage the entire process up until you receive a mortgage letter from the chosen lender.