Top Mortgage Tips for First Time Buyers

18 January 2022

Paul Demarco, an independent mortgage adviser has provided five essential tips for those buying a home for the first time.

The first question many first-time buyers and home movers have is “how much can I borrow?”, this is often followed by “what is the best deal can I get?”. Unfortunately, the answers to both these questions are not as straightforward as we’d like. 

In today’s mortgage market, affordability is carefully scrutinised, this means how much you can borrow doesn’t just depend on your income. Lender will, instead, carefully check your credit record and financial commitments.

As for getting the best deal, this depends on your finances and preferences as well as your attitude to risk and your life stage.

With some careful budgeting and the correct advice prior to applying for a mortgage, you can successfully boost your borrowing power and ensure you get the best deal for your needs.

Here are some of Paul’s top tips for first time buyers:

1. Increase your deposit

Increasing your deposit by just a small amount can boost you into the next loan to value band, meaning that you might benefit from a better interest rate.

2. Register on the electoral roll

Ensure you are registered on the electoral roll at your current address, as this can have a bearing on your credit score.

3. Overpay where you can

Once you have your mortgage in place, if your mortgage product allows it, use the overpayment facility. You will be surprised at how much difference even a small overpayment can make monthly when it comes to the total interest over the lifetime term of your mortgage.

4. Opt for a fixed rate

As we’re currently in a low interest rate cycle and mortgage product affordability is close to record lows, it makes sense to fix your mortgage rate for a specific term as you can achieve stability of payments over the fixed rate periods.

5. Boost your credit score

If you’re looking to buy right now and don’t have a good credit score you should do as much as possible to change it. As mentioned previously, registering on the electoral roll at your current address can help.

Also, consider taking out a credit card and use it as much as you can to purchase small items while making sure to make any repayments within the appropriate timescales. Also, generally make sure none of your payments are ever late, including rent and bills as this can have the adverse effect on your credit rating.