Once you reach a certain age, you should be thinking about looking for a way into the property market. We’re not talking about a late stage in life either. If possible, you should work to make sure that you get on the property market as quickly as possible by purchasing a small home. This isn’t necessarily for investment purposes, and you can live in the home yourself. Hopefully, you will get to sell your house for a lot more than you bought it for in the future. There are lots of ways to make sure that your home grows in value, but that’s not what we’re looking at today. Instead, we need to think about how to make sure that you can actually get on the property market in this first place.
Unfortunately, there are a number of roadblocks that can stop you getting on the property ladder. Let’s look at a few of these and make sure that you know how to get around them so that you can buy a piece of property for yourself and reap the benefits of doing so.
Bad Credit
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You definitely need to think about your credit score when you consider buying your first piece of property. If you have a poor credit score, you’re going to run into on major issue. You’re not going to be able to get access to any of the best mortgages.
Ideally, you need your credit score to be seven hundred plus to get the best mortgages on the market and make sure they are open to you. How do you do this? If your credit score is poor, then you need to improve it. The best way to do this is to pay off any debts that you have open as quickly as possible. In some cases, you might not even be aware that you owe money. This is surprisingly common, and it’s just a case of checking your outgoings and making sure you are up to date with bills and such. Once you have paid off your debts, your credit score will improve, and there’s another reason to do this.
When you buy a home, you are going to be under financial pressure due to mortgage repayments. So, it is best to start off with a completely clean slate here.
Of course, for most people it’s not going to be an issue of poor credit but rather an average credit score. Believe it or not this can be more of an issue. An average credit score could be because you haven’t borrowed at all. For everyone saying that credit cards are dangerous financially are missing a key point. Credit cards allow you to build up a history of borrowing. You just need to make sure that what you borrow you pay off on time and eventually you will see your credit score grow dramatically. A few years of smart borrowing and you’ll be in a position where you can buy a home thanks to a healthy credit score.
House Prices Are Too Expensive
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Of course, even with a great credit score, you might find that home prices are just too expensive for you to manage. The average home is roughly nine times the average annual income. That’s an issue because you’re not going to be able to put your entire income towards the property. Instead, you’ll need to save little by little. Are there any homes that are cheaper and more affordable? Actually yes, there are, but you have to be careful with that idea. Homes that are cheaper are either old or fixer-uppers. This means that these houses have their own problems. For instance, older homes may have issues that can be dangerous to your health. And, if one day you decide to have kids you’ll probably need to deal with that. It could cost you a lot of money too. For instance, older homes often have asbestos for insulation and to remove this could cost upwards of ten thousand. That’s probably not the type of bill you want to take on after just buying a home.
There are other issues too like replacement of parts and utilities. You might find that the heating system is dated and unreliable in a fixer-upper. If that’s the case, you could again be looking at a bill of a few thousand at least.
There are other expenses to consider too like energy bills. If you buy an old home, there’s a good chance that the insulation is awful. This means you’re going to need to spend a lot more heating it and making sure that it stays warm particularly through the winter months.
Perhaps then it’s best not to look at old homes or fixer uppers. Instead, you should be pursuing the possibility of buying a new home at a great price. To do this, you need to find someone who is desperate to sell. That’s not as difficult as you think and if you come across a home that is already empty chances are that the seller is looking for a fast transaction. You’ll get a good price, guaranteed if you make the right offer.
Mortgages Are Too Expensive
Of course, paying for the home with the deposit is only half the battle. The other big issue that you need to make sure you can afford is the mortgage. Mortgages can be expensive even if you do have a good credit rating. Handling this is a matter of getting the help of a good mortgage broker like Brighter Finance. Companies like this act like gatekeepers. They can often gain access to the mortgage deals that you didn’t even know existed.
Getting the right deal on your mortgage is crucial to make sure that you can afford the home itself. In many ways, the mortgage is actually the bigger mountain you’re going to have to climb. Paying for the deposit is just a matter of being a great saver. The deposit is a long-term commitment, and you have to get the right deal.
Take this advice, and you’ll be able to break through the roadblocks stopping you climbing that property ladder.
