Getting in young: Tips on an early mortgage
The housing market can seem impregnable if you are in your late 20s or early 30s as you move out of flatting and look towards a more permanent residence. However, with the right planning you may be able to find that a mortgage on a house won’t cost you much more than your rent! Here’s some tips to start you off.
Clear your credit
We’ve all had that situation when you get stuck with your name on a bill that an old flatmate hasn’t paid, or an old payment that everyone forgets about comes back at you. Unfortunately, things like this can block your path to obtaining a stable home loan. Check your credit history, and if you need to, clear up anything outstanding. If this isn’t possible you can always apply for a non-conforming loan, but these can have higher interest rates.
How much will you need?
Have you saved enough for a deposit? This is typically anywhere between 10 and 30 per cent of the total home price, although anything above 20 per cent lets you avoid lenders mortgage insurance. Once you have your deposit, you need to budget extensively. A mortgage is a long-term plan, and you need to make sure you have the stability to keep paying it, so lock your job in and plan your monthly budgets with your partner if you wish. Mortgage brokers can help you organise these numbers and determine which loan plan will work best for you if you’ve been asking yourself how much you can borrow.
Don’t be afraid to ask
Sometimes, the costs of home buying can seem prohibitive, and that’s why you should always seek help if need be. Approaching a mortgage broker can take the hassle out of any financial planning you need to do, by providing details on loans and expert advice on budgeting. Also, don’t be afraid to seek out affordable suburban homes. These tend to be in growth areas that will see your home increase in value! Pick the right area that fits your budget and we’ll get you on the way to home ownership.