Getting on the property ladder seems like an exhausting task. You have to build a good credit score, find the right house, Save Save, Save, and be in a good position to pay your monthly mortgage. All of this can seem daunting even for those who are more mature with a family and partner to help accommodate all the cost that comes with purchasing a property. Nevertheless, you do not have to wait till then to get on the property ladder. It can be done when you are young and single. Here are three tips to get you on the path.
1. Property = Finance = Credit Score
This is important! I cannot stress this enough. It doesn’t have to be perfect but good enough to have your bank or mortgage providers to lend you the amount of money you will request. You can check on a previous post on credit cards to see how you can utilise it improve your credit score. There are many sites available to track your credit score. Experian and Noodle are places you can check your credit score for free. Experian does have a paid service of 14.99 a month. This might seem expensive but I know from experience that it is money well spent. I used the paid service for a year. There were detailed resources available on what was affecting my scores either positively or negatively. Some banks (such as Halifax) also offer free Credit score checks so I will suggest checking with your bank as well.
There are many financial bits of help available to help you get on the property ladder. There is the Government help to Buy and Forces help to buy if you serve in the military. Forces help to Buy contributes to the deposit of the house purchase. It is important to read the DINS and JPA (if you are military you will know what this means) available on this and to also check with your HR Specialist.
There are four types of scheme available. These include Help to Buy ISA which is more of a savings account and only available to first time buyers; Shared ownership, Equity Loan and London Help to buy. In this post I will be focusing more on first-time buyers, this is mainly because it is where I am most experienced in. Do click on the links for information on the other schemes. There are details on how it works, eligibility, how to apply and many more. With these government schemes, it is also possible to put down a 5% deposit rather than the traditional 10%. However, do bear in mind that, the less your deposit the more your monthly repayments.
3. Savings – Help to Buy ISA.
This scheme is and was a money saver. It helped pay for my solicitor’s fees which were just shy of £1000. It pays first-time buyers a government bonus of 25% of their final savings amount. For every £200 saved, there is a £50 bonus with a maximum of £3000. When the account is opened, for the first month a payment of £1200 is accepted. (it is not a must to have that as your opening balance) from then on you can save up to a maximum of £200 per month. The minimum bonus to receive from the government is £400. One of the amazing thing about this scheme is that it is not accessible to each household but the buyers. For example, if you intend to purchase with another person, be it your significant other, parent or siblings, so long as all parties are first time buyers you can all open the ISA account with the participating bank, credit union or building society and receive the bonus separately. So if you both save £4000, you will each receive 25% bonus. Your solicitor will claim the bonus for you and it will contribute towards the purchase of the house, i.e. Solicitors fee, lad registration, initial deposit, etc.
There are many other forms of saving and the following link shares great tips. Be sure to check it out for more information.
“a man who both spends and saves money is the happiest man ecuase he has both enjoyments”