First-time buyer? Uswitch reveals tips to raise an extra £23k
For a first-time buyer, getting a mortgage can be daunting, but Uswitch have revealed some all-important tips to raise an extra £23k.
An increase in mortgage offer delays caused by the pandemic has meant that first-time buyers are now having to save an extra £23,000 to get onto the property ladder – an overwhelming amount for many who are saving while trying to secure a mortgage.
The mortgages team at Uswitch have come up with five actionable tips you can put into place when it comes to buying your first home – from creating a list of exactly where your money will go, to looking into how much you can typically borrow.
But, while the team at Uswitch is on-hand for helpful tips, always consult a qualified financial advisor when making any money-related decisions.
So if you are ready to get saving, check out these all-important budgeting tips below:
1. Take a look at different schemes for first-time buyers
There are various government schemes set up to help first-time buyers save money, such as the First Homes scheme.
In short, the scheme was set up to allow first-time buyers to save 30% or more on their first home, which would require a smaller deposit and, in turn, lead to a much smaller mortgage.
However, once you were ready to move on and buy a new property a few years down the line, you would have to apply the same First Homes discount when selling your house.
2. Open a specific savings account
This may seem like an obvious tip, but opening up an account specifically for your mortgage payments is a good way to get into the habit of setting money aside, even before you buy a home. Then when you do have mortgage repayments, this will make it easier to avoid overspending.
Having all of your money in one account can lead to confusion, along with the temptation to make an impulsive purchase – having an ‘untouchable’ account would remove this.
It can be helpful to check different banks and their interest rates to make sure you are getting the best deal.
3. Make a list of expenses
Being transparent about how much money you have to spare, after bills, grocery shopping and other expenses, can make how much you can afford to save clearer.
If you know exactly how much you spend each month, you can easily determine how long it will take you to save up for your mortgage. After this, a direct debit into your savings account can be set up, automatically moving across the money you’ve committed to saving each month.
4. Head home for a while
If possible, it could be beneficial to move back into your parents’ house for a while. This could allow you to save money on rent and bills, along with lowering the cost of groceries and utilities.
If moving back in with your parents is not an option, temporarily living with another relative that is willing to offer you more reasonable rent would also allow you to top up your mortgage savings.
5. Check your credit score is as healthy as possible
Making sure your credit score is high is a great way to ensure the best deal when it comes to your mortgage.
Checking your score would be the first step and, if it is looking slightly low, it could be helpful to invest in a Credit Builder credit card. Making sure you have good credit could avoid having to get a mortgage with a higher interest rate.
Kindly shared by Uswitch
Main photo courtesy of Pixabay
