If you are interested in buying your first property, there is a lot to consider, and we are here to help:
Consider a guarantor mortgage – If you are really struggling to save up the deposit that is required for a mortgage, or you have a bad credit rating and the lender is not willing to accept your application, you should consider getting someone else to guarantee your mortgage. This means that a guardian, parent, or close relative will agree to be responsible for paying off your mortgage if you fail to do so. Needless to say, this is a big commitment and it is not something that should be entered into lightly. It needs to be with someone you trust, and someone that trusts you. These are legally binding agreements, and so the guarantor needs to be in a position where they can afford to pay off the mortgage if you default on the payments.
Work out all of the expenses so you can budget everything properly – From reading up on hvac vs ac to understanding the closing costs, you need to make sure you understand all possible costs so you can budget properly.
Explore your saving options – You need to determine where you are going to save your cash. This is important because it could lead to a nice bit of interest being added on top for you. If you are saving on a short-term basis, you have the option of easy access accounts and regular savings accounts. Don’t expect any amazing interest rates, but do explore them before choosing an account. After all, 1% is much more than you may expect when there is a lot of money involved. If you still have several years to go before you buy a house, there are a number of savings accounts that are worth considering. Firstly, you should consider a current account. This may sound odd, however, there are some current accounts today that pay more than savings accounts do, and so it is definitely worth exploring this. You will also have the added benefit of the account being completely flexible when it comes to getting your money out. However, there is one downside, and this is the fact that the higher interest rate will typically only apply to a set limit. On the other hand, there are fixed rate bonds and cash ISAs. The latter is a great place to start, as the interest you get will be free from income tax. You have the option of a fixed rate ISA or a variable rate ISA. The latter is when the rate goes up and down, whereas the former is where you know exactly what you are going to be paid over time.
Hopefully, you now have a better understanding regarding the different options that are in place when it comes to saving for your first property. Take the time to explore any help that is available to you and put together a sensible and realistic saving plan, then you will be well on your way to your first home.
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