What Every Prospective Buyer Needs to Know
Buying a home is probably the biggest financial decision you’ll ever make. Knowing when you’re ready isn’t just about having a deposit saved; it’s about being prepared for all the costs of buying a home and being in a stable financial position. Not sure if that’s you? Here are five key signs that you’re financially ready to take the plunge, and how our experienced mortgage advisors can help you.
You Have a Solid Deposit Saved
The first and most obvious sign is having enough savings for a deposit. Most lenders require a minimum of 5% of the property’s value, but aiming for more can help you access better mortgage deals with lower interest rates.
If you’re unsure how much deposit you’ll need or what you can afford, we’re here to help. We offer tailored advice and help our clients understand the impact of different deposit sizes on their mortgage options.
Your Credit Score Is in Good Shape
A strong credit score is essential for securing a mortgage with great terms. Lenders use your credit score to assess how well you manage debt and determine how risky it is to lend to you. If you consistently pay bills on time and your credit utilisation is low, you’re in a great position.
If you’re concerned about your credit score, we will be able to connect you with lenders who are a little more flexible. We can also provide advice on how to improve your credit, from small actions to big changes.
Your Income Is Stable
Lenders want to see that you have a reliable income to cover your mortgage repayments. This doesn’t necessarily mean earning a high salary, but it does mean being in steady employment or having a consistent income stream if you’re self-employed. You’ll have to provide evidence of this.
We specialise in helping clients from all employment backgrounds, including those who are self-employed. We can recommend lenders who are understanding of non-traditional careers, giving you the best chance of success.
You’ve Budgeted for More Than Just the Deposit
- Buying a home comes with costs beyond the deposit. These include:
- Stamp Duty (if applicable)
- Survey and valuation fees.
- Solicitors’ fees.
- Moving expenses.
- Costs of initial home improvements.
We aren’t just here to help you find a mortgage; we’re here to guide you through the entire process. We can help you anticipate and plan for these additional costs, so you’re not caught off guard. So, come talk to us as early as possible!
You Have an Emergency Fund
Even after saving for a deposit and budgeting for additional costs, it’s important to have a little extra set aside. Life is unpredictable, and some money saved can protect you from financial stress if unexpected events occur. Anything from urgent repairs to redundancy can make life more challenging, and an emergency fund ensures you won’t fall behind on mortgage payments either.
We will assess your financial situation with care and compassion, ensuring you’re not overstretching yourself and have the financial stability you need. We’re not here to push you into signing up for a mortgage that isn’t right for you – we’re here to look out for you.
Talk to Us
Buying a home is a big step, but hopefully, we’ve helped you to know if you’re financially ready to take the leap! To find out more, please talk to us at A Little Mortgage Advice today.
