Getting Off The Start Line

*Your home may be repossessed if you do not keep up repayments on your mortgage* Your first steps onto the property ladder are more than likely going to require a little bit of planning, but also a bit of groundwork on your part.  We have seen it in the past where people find the dream home only to fall at the first hurdle because they hadn't got everything in order. Just taking the time to get your 'house' in order can make the whole process of buying your first property a lot easer and less stressful.  Here are a few areas to focus on that will make the whole process a lot more simple:
  1. Credit Report - Know what your credit report has on file for you.  This is particularly important if you've lived in a flat as the address format may or may not pull through all the correct information for you.  Getting this formatted correctly so that you can see your bank accounts and all credit commitments is essential.  Also, making sure you are on the electoral roll is crucial too.The other area to check is that all your accounts are up to date and there's no missed or late payments, or even defaults or county court judgements on there.  If there is anything on there now, you have the time to resolve and ensure your credit report is as clear as possible at the time of application.You can get your credit report from a few places, the most popular being Experian, Equifax, CallCredit and Noddle.  Some of these charge for their services, and some of these are free.  If you do this now and you know that your payment history is good and there's nothing erroneous on there, then this is a good first step to getting your mortgage.
  2. Deposit - Know where your deposit is coming from.  Is it from savings? If so, how much?  Is it a gift from parents, and if so, can they evidence this?  Is it a gift from a non-family member? This is less common and also begs the question of why someone that is not a family member would give you money to buy a property!
  3. Affordability - This is one of the most important ways in which lenders will assess your mortgage potential, so taking out the loan for a new car or the credit card bill each month, or even buy now pay next year, these can all be commitments that can impact the amount you can get on a mortgage, so keeping your credit records as low as possible could make a big difference when applying for a mortgage.It is also key to know how much you can actually spend on somewhere.  We have this perception that because we can afford to pay it that the mortgage lenders will lend it to us, but this isn't the case, and what you don't want to do is to find your dream home, but then not be able to get the mortgage to back it up, which takes me to the next point.
  4. Mortgage - So, where do you start with this one? A lot of people go to their bank, because they've been with them since they were kids, and therefore the bank will look after them.  This is simply not the case.  Also, how do you know that the bank's criteria is going to be right for you? Every lender has completely different criteria, so your profile may not be right for them.  Also, if you try one lender, and they say 'No', do you work your way down the high street? What about the lenders you don't find on the high street?  They can often have competitive rates and great products.  The key thing here is that when you are looking to spend thousands or hundreds of thousands of pounds on your purchase, get professional advice.  Professional advisers will source the market for you, talk to underwriters, work out the best deal in the market for you, and with our service, we also do the paperwork and case management for you too!
  5. Agreement in Principle - So, your credit report looks good, you're on the electoral roll, you know what deposit you have and where it's coming from, and you know what your maximum purchase price is.  Great job, well done, so the next step is to obtain an agreement in principle.  This works by confirming that you are potentially good for the mortgage amount, but also when you are talking to estate agents and you have your agreement in principle in place, then they are more likely to take you seriously, but also it puts you in prime position with your potential purchase if other interested parties are not in the same position.  It makes sense really.
Here are just a few simple things you can do to get you off the start line and in readiness to buy your first home.  Getting organised and prepared will definitely take the stress and hassle out of problems further down the line and make the process of buying your home easier. Good luck with buying your home, and if there's something you still want answers on, then contact us at business@crystalclear, on the phone, (01483) 487417 or through the contact us on our website - www.crystalclearfs.com.