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Are you wondering how to get onto the property ladder in the UK? This is a problem facing many young people in the UK at the moment – and that’s where the right guidance can be extremely valuable.
As the market changes, and interest rates go up or down, the affordability of purchasing a property changes. Nevertheless, there are many steps you can take which will help you to get onto the property ladder – and we have outlined 10 of these in the blog below.
1. Start saving as soon as possible
Getting onto the property ladder isn’t easy – and the sooner you start saving up, the better. When you are able to put a larger deposit down on a property, it makes you a ‘safer bet’ for the mortgage lender. Therefore, the more money you can save up for a deposit, the more likely you are to be given a mortgage.
2. Speak to a mortgage advisor
There are mortgage advisors in almost every town in the UK – and there is a reason for this. The right advisor can be an extremely valuable resource in your mission to get onto the property ladder. They will be able to give you insight on your:
- Affordable price range
- How much you can borrow
- Steps you can take to improve your position
A mortgage advisor can even help you to get a ‘mortgage offer in principle’, which makes you a more attractive property for lenders.
3. Identify the most affordable areas
Everyone has ideas about their ‘dream home’ – but sometimes, this isn’t the most realistic. Identifying affordable areas where you can purchase a property is an important step in getting onto the property ladder.
If you aim too high, you will be unlikely to achieve it – and will be back to square one.
4. Find someone to live with
In the vast majority of cases, purchasing a property is far more affordable when you do it with someone else. The deposit that you can raise together will typically be larger than you could do on your own – and your combined salaries also means that you will be able to borrow more.
5. Boost your credit score
For first time buyers looking to get onto the housing ladder, making sure that lenders can access an accurate credit history is an important starting point. This enables the lender to assess the level of risk that mortgage customers represent.
Some steps you can take to boost your credit score include:
- Register for the electoral roll
- Know your credit every time you apply – and space out your applications
- Don’t hold too many credit cards
- Always pay back debt
- Use a landline number when applying
These steps will make it more likely for you to secure a mortgage.
6. Pay off any debt
If you have any debt which has not yet been paid off, then it is important that you make this a priority. Unpaid debt will seriously damage your chances of being granted a mortgage by a lender.
7. Research government schemes
The UK government is aware that it is difficult for first time buyers to get onto the property ladder. It is for this reason that many schemes have been introduced which makes it easier to do so. You should research ‘leg-up’ schemes which you may be able to take advantage of.
8. The Bank of Mum and Dad
While not everyone is in a position to ask their parents for help, it is certainly worth checking if they can provide any financial assistance. Many first time buyers are getting onto the property ladder through the assistance of their parents – so it is nothing to be ashamed of.
Some people prefer to take a loan from their parents (which they promise to pay back) as a way of getting onto the property ladder, without feeling like they are taking advantage of their parents.
9. Ask your work for a pay rise
The amount of money you can borrow for a mortgage is determined by your salary. Therefore, if you are able to increase your salary, you can borrow more money – and your chance of getting onto the property ladder therefore increases.
If you have not already asked for one recently, it is worth speaking to your employer about an increase in your salary.
10. Consider renting out a room
Some first time buyers consider renting out a room in their property after they buy it. This can make the house significantly more affordable, since they are using it to generate some extra income.
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