5 May 2020
The biggest mistakes first-time house buyers make
Buying your first home is an incredibly exciting process as the prospect of getting on the property ladder and moving up in the world is a right of passage many enjoy walking.
However, there are many hoops you need to jump through as a first-time buyer and some of the obstacles may be much bigger than you first thought.
There are a number of traps which many people also fall into, costing them their chance to buy a home for years.
If you are thinking about buying a home for the first time or you are already in the process, make sure not to make any of the following mistakes.
Don’t try to get a loan mid-way through the buying process
When you are in the middle of buying a home, a complex process of checking your finances will be taking place between your selected mortgage provider and the credit agencies.
This is in place to ensure that you will be able to pay the money back to the bank you are lending.
That is why, under no circumstances, should you compromise your lending or major finances during this time.
Even though you may think that taking a loan from another bank to pay for your new furniture is unrelated, this could be the difference between your bank accepting your mortgage or denying it.
This is because your financial situation and outgoing payments will change halfway through the financial checks, which could instantly void everything.
Not paying attention to your credit score
Your credit score is critical for buying a first home, if it is too low, you will get rejected for a mortgage. It’s that simple.
There are a variety of things you can do to increase your credit score, but the first thing to realise is how important it is.
Click here to read a comprehensive article if you do not know what a credit score is and how to improve it.
Get a ‘Mortgage in Principle’
A mortgage in principle is an agreement between you and your lender which demonstrates that you have the finances and agreements in place to pay for a home when it comes down to a potential bidding war.
Many people do not get a mortgage in principle as it is not a requirement to buy a home, but this can cause serious problems as people may not know they will fail in getting an agreement until much later in the process of viewing homes and settling on a property to purchase.
Failing to use rental payments to build credit
If you are paying rent to a private landlord and not making use of a credit agency to register the transfer, you are missing out on vital points being added to your credit score.
This is something that our experts can provide more information on, as even if you are thinking of buying a property in five years time, this is something which you should be thinking about now, so make sure to get in touch.