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If you’re in a position where you are just starting to think about buying your first home, there are a few things you can do to better your chances of becoming a property owner. Given your circumstances as a first time buyer, one of the biggest challenges you’ll face is finding and securing a mortgage.
A recent report has shown that almost half (45%) of all prospective first time buyers have had their mortgage applications rejected at least once. This highlights how difficult it can be, without the right guidance, to get accepted for a mortgage when you’re looking to buy for the first time.
However, there is still lots to be hopeful about! Taking that first step onto the property ladder is far from easy, but it’s not unachievable if you are disciplined with your savings and follow these 5 top tips from our first time buyer mortgage experts.
Your credit history is one of the first things any lender will look at before offering you a mortgage. By taking measures to improve your credit score before your application, you’ll put yourself in a much better position to be accepted.
Once you’ve found this out, there are a few steps you should take to actively improve your credit score before applying for a mortgage. These include:
If you do have a bad credit record, don’t panic. Getting accepted for a mortgage with adverse credit is slightly more complex but still achievable – head over to our bad credit mortgages page to learn more about this.
While some lenders do offer 95% mortgages (with only a 5% deposit) to first time buyers, these are more rare and are not always necessarily the best option to take. The standard minimum deposit amount is 10%, but the more you can put down the more likely you are to be accepted, and the better the deal you will get.
It’s worth exploring how you might be able to boost your savings with either a Lifetime ISA or a Help To Buy ISA. With these products the government will top up your savings amount, helping towards your deposit.
If you are fortunate enough, your parents or relatives might also be willing to help you out by putting some money towards your deposit. They don’t call it the ‘Bank of Mum and Dad’ for nothing!
If buying on your own feels like it would be too much of a stretch, you might want to consider buying your first property as a joint purchase with a friend or relative. This will offer you more options and increase your chances of getting a mortgage, because there will be more than one person to pay it off.
When buying with a person who isn’t your spouse or partner, you’ll need to plan out what would happen when one of you wants to sell and move on at a later date. Especially if one of you is paying a larger share of the deposit.
If you are self-employed or a contractor, lenders have additional checks that they carry out in order to verify your earnings. In this case, the most important thing you can to improve your chances of getting accepted is to get your paperwork in order well in advance.
Lenders will want evidence of your income and your ability to make repayments, so be prepared to be able to show these documents.
Lastly, is our most important tip of them all. Speak to a whole of market mortgage advisor!
As a first time buyer, you’ll face a number of challenges when searching for and applying for a mortgage. Not only this, but there’s a lot of complex terminology and processes to get your head around which leads to a lot of hassle. Getting professional advice significantly increase your chances of being accepted and makes the whole house buying journey a much smoother process.
At Your Mortgage Options, our advisors are independent and ‘whole of market’ meaning they have access to the whole market of lenders, including those not available on the high street. By only going directly to one lender yourself, you massively limit your options, and therefore your chances of being accepted.
Enquire online to speak to a mortgage advisor over the phone today, for a free initial consultation.