Buying your first home is a massive milestone. It requires lots of saving, patience, and a whole lot of Googling technical terms, because, let’s be honest, ‘How to understand a home report’ wasn’t part of the curriculum at school. Here are a few ways you can make that first step on to the property ladder a lot less stressful…
First things first, you need to know exactly what you can afford and what you’re eligible for. The last thing you want to be doing is viewing houses only to realise later that they are out of your budget. I used the Virgin Money mortgage eligibility checker Link opens in a new window (this is a soft credit check that doesn’t affect your credit score) to work out what we could afford, how much we’d be likely able to borrow whilst also taking into consideration monthly bills, outgoings etc. This will also help you decide how much you need to save for your deposit, as it’s a percentage of the overall mortgage value.
Top tip: If you’re buying in a sought-after area, you may also have to offer more than the valuation, so be sure to factor this into your overall budgeting. Buying a new build or a fixed price property can be attrac-tive if you don’t have a lot of spare cash.
Save, save, save
Once you know how much you need, it’s time to get saving! But how do you start saving for a house in your 20s? It took us almost two years to save our 5% deposit (we chose the Virgin Money 95% Loan to Value mortgage Link opens in a new window) and a little extra to cover additional costs. Remember, it’s not just a deposit you’re saving for. You’ll also need to save for legal fees and, potentially stamp duty. It’s much easier to save a fixed amount if you set it aside on payday, instead of just trying to save what you have left over at the end of the month. Use this as an opportunity to review your regular spending and any direct debits you have. You will be surprised how much of it is unnecessary expenses - making your own lunch every day instead of buying meal deals makes much more of a difference than you’d think! With the Virgin Money M Plus account Link opens in a new window, you can set up various savings pots to help you budget and keep you on track for your end goal.
Top tip: To help guide you through the many stages of the home buying journey, download the Virgin Money Home Buying Coach app Link opens in a new window – it’s the perfect companion for buying your first home. Its handy fea-tures include creating a personal plan that fits your circumstances, a checklist to keep you on track and detailed guides about the different stages of the home buying process.
Deciding on the right mortgage for you
Make sure the mortgage you choose is the right one for you. Many people assume that you need a mini-mum 10% deposit for your mortgage, but Virgin Money offers up to 95% Loan to Value mortgages Link opens in a new window, which means you only need a 5% deposit. However, keep in mind monthly payments will be higher as it’s a larger loan value, so it’s all about what suits your circumstances best. This is the mortgage we decided on as it meant we could get on the property ladder sooner.
Top tip: Don’t be afraid to ask questions that you think are ‘stupid’ – buying a home is likely to be the big-gest purchase you’ll ever make so it’s important you know and understand everything and the Virgin Money mortgage team Link opens in a new window are happy to help.
Preparing to move in
When we found out that our offer was successful on our first home, we then started to work out the total monthly cost of our household bills - council tax, TV and broadband, gas & electricity, TV licence, home and life insurance and, of course, mortgage payments. This again allowed us to be realistic and set new budgets in line with our monthly expenditure. You can use the Virgin Money Mobile Banking app Link opens in a new window to help you budget better.
Top tip: Don’t feel the pressure to buy everything new for your home. You can find some amazing bargains Link opens in a new window in charity shops, on community Facebook pages or Gumtree. With a bit of TLC, you can upcycle furniture to put your own stamp on it, whilst saving money and helping the environment!
For First Time Buyers Link opens in a new window, Virgin Money has a range of different mortgages up to 95% Loan to Value available. And it’s not just for first time buyers, after four happy years in our first flat, we made the move to a bigger home and Virgin Money made the whole process so easy to move to a new mortgage deal too. View the full range of mortgages available.
Remember, don’t risk losing your home – keep up those mortgage repayments. This article does not constitute financial advice, please seek advice from a Financial Conduct Authority (FCA) authorised Mortgages broker or lender.
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