There are lots of ‘big moments in your life’, your 18th birthday, passing your driving test, or even getting engaged. We think the biggest is buying your first home, and we’re here to help support you through one of the biggest commitments you’ll probably ever make in your life; getting a mortgage. When you’ve got the Vernon on your side, mortgages don’t need to be intimidating.
The first step to consider is, are you ready to take on this responsibility? If you’re moving out of your parents’ house, will you be able to look after yourself if you’re living alone? Are you able to cook for yourself and keep the house clean? You’ve more than likely considered all these points already, but it doesn’t hurt to be sure!
To be able to purchase a house, lenders will want you to have a deposit ready to put down for any potential mortgage you’re looking to take out. This is proof that you’ve got the discipline to put money aside. The amount of deposit will determine what your Loan to Value (LTV) will be. The lower your LTV, the better interest rate you'll be able to get. For first-time buyers, a 90-95% LTV is very common and there are options available at the Vernon.
Alongside saving for your deposit, there are other costs to consider. Solicitor fees, valuation fees, stamp duty, broker fees and an arrangement fee may be applicable for certain mortgage products, plus any moving costs involved with getting moved into your new home.
So how can you maximise your savings for a deposit? Here are some cost-effective tips to help you save as much deposit as possible:
- Do you go to the local sandwich shop for your lunch? Do you have a cheeky McDonalds every now and then? Bringing your own lunch from home can reduce your weekly food expenditure. For the price of one McDonalds meal, you could buy enough ingredients during your weekly shop to make 5 days worth of packed lunches.
- Could you cancel some of your monthly subscriptions to video services like Netflix or Disney+? Could you use the free version of Spotify rather than paying for the premium version? Making small sacrifices like these can increase the amount available for you to move into your savings.
- Are there some items you could scale back on? If you shop for branded clothes, you could save some money by choosing cheaper options at different stores, or even shopping around for second-hand clothes.
- Have you got items lying around that you no longer use that could be sold online? This would free up some space and bring in funds at the same time.
- Are you within walking distance or could you cycle to work? Options like these can save money on petrol and parking, whilst keeping you fit at the same time!
Now you’ve got your deposit quietly building in the background, you can start looking at potential properties.
There are several products available to first-time buyers that can help you get your foot on the property ladder, such as Guarantor Mortgages and Joint Borrower Sole Proprietor. If you are heading off to university, we have a Buy for Uni
product that helps students buy their own property and rent out rooms to other students, making you the landlord.
It's free to speak to one of our qualified Mortgage Advisers and they can advise you on your next steps to get onto the property ladder. Get in touch to find out more.