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Property Finance Tips For First Time Homebuyers

Your first home is likely to be the most expensive thing you’ve ever bought in your entire life.

The homebuying process is full of hidden costs and you can easily end up spending a lot more than initially planned. There could also be obstacles such as a bad credit score that stop you from purchasing a property even if you have the adequate funds. Here are just a few tips to help you get financially ready and to help you avoid hidden fees.

Fix up your credit score

Many mortgage lenders will reject you if you have a bad credit score regardless of whether you have enough money for a deposit. A rejection can damage your score further leading to a vicious downward spiral in which your score gets increasingly worse. Avoid applying for any mortgages until you’ve cleaned up your credit score (if it needs cleaning up of course – if you’ve already got a good score, you’ve got nothing to worry about). There are credit builder schemes that can help improve your score. Paying off other debts and not missing payments can further help to improve your score.

Consider hiring a mortgage advisor

Mortgage advisors can help to make shopping for a mortgage easier. Not only can they help find the best rates for your budget, but they can also educate you on anything regarding mortgages that you may be confused about. Some mortgage advisors may even have access to deals that cannot be found on the market due to special relationships with certain lenders. You may be expected to pay a fee for their help, although there are free mortgage advisors out there.

Invest in a surveyor

You don’t have to hire a surveyor, but it’s a safe investment. Surveyors check your home for any signs of damage and can tell you if there are any potential costly repairs around the corner. This could save you purchasing a property that’s going to cost you thousands in repairs in the near future.

Avoid agency buyer fees

Agencies should only ever charge the seller. That said, there are some agencies out there charging fees to buyers. Always ask about agency fees upfront so that you can avoid paying these extra unneeded costs.

Time it right

When you make your purchase, you want to be certain that you have the funds available. If you’re selling another asset to afford your deposit and are waiting to receive the money, you could always look into bridging loans to avoid missing out on the chance to purchase the property there and then. Be wary that if you buy late in the month, you may also have to pay the first month’s mortgage instalment upfront.

Negotiate everything

Be prepared to negotiate any fees that you can. Many surveyors and conveyancers won’t have fixed prices and may be willing to lower their prices if you ask them. As for the price of the property itself, there is usually always about 2% leeway when negotiating the value – just be careful if lots of buyers are interested as the seller may opt for the buyer willing to offer the most.

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