With house prices on the rise securing a mortgage can be increasingly difficult. As a home buyer, there are deposit options from as little as 5% of the property purchase price.
In 2020, the average first-time buyer deposit in the UK was about £57,300. However, in the capital (London), that figure was almost double.
This guide is our tips to help you save money more effectively & help get you one step closer to buying your dream home.
1. Set A Budget To Stick To
Having a plan for your finances can help put your best foot forward when it comes to saving as you have a physical reference to stick to. It also helps you form accountability with yourself to help enforce the habit. For example, if you decided you’d save £350 a month and had it in your budget planner and it will encourage you to pay off your expenses and then set aside the money each month.
2. Create A Savings Account
It can be best to choose one with a higher interest rate as this can help you get more gains on your savings. Also, it allows you to put away money in smaller more manageable amounts it also means you could set up a monthly direct debit that sends your money into your savings. This can help as then the money stays ‘out of sight out of mind’. This makes it more difficult to spend which can make a difference.
3. Get A Joint Mortgage
Considering a joint mortgage can help massively with the value of the property you’ll be able to afford as typically lenders multiply your yearly income by 4.5 to work out how much you can lend so if you make £25,000 a year you’d be able to lend £112,500, but if you have another person on the mortgage who earnt £20,000 per year that would an additional £90,000 to your potential loan amount meaning you would have a potential budget of £202,500. (Approximate figures, can be affected by multiple factors.)
4. Cut Back Where Possible
If you’re wanting to go all-in on saving for your property cutting back on non-essential spending can help create huge progress activities like meals out, nights out & holidays can make it much more difficult for you to save. So cutting them out although it’s a short-term pain can lead to the long-term happiness of buying a home.
If you want to go the extra mile taking steps like switching to a cheaper supermarket or not buying name-brand products can help free up some extra cash each week to put straight into your savings.
Using public transport for your commute can also help you increase saving instead of fueling a personal car.
These types are by no means a guideline for everyone as each individual is different, it’s important to find what works for you but the hardest part is making the start!
If you need any help with securing a mortgage don’t hesitate to talk to our mortgage team at admin@tbmp.co.uk , visit the Facebook page or call them on 01158229469
Thank you for reading & See you soon!
