It’s the start of a new year and you may have aspirations of buying a new home in Chelmsford, but are you ready to make some changes to improve your home-buying situation? When it comes to buying a home, the crucial area that you need to get into tiptop shape is your finances. Are you prepared to make some changes to place you in a strong position for moving in 2020?
Postpone a new direction
Stability is an attractive trait to lenders, so if you’re considering a new job or a change in a career it could be wise to postpone it until you have moved home. A steady employment record with no gaps over the last two years is preferable, as this helps your lender to forecast future income. Ideally you want to be in a secure position for at least three to six months before applying, so you’re no longer in your probationary period. Sometimes an opportunity too good to miss may present itself whilst you are looking for a new home, if so, let your lender know as soon as possible.
Do you really need it?
We all have subscriptions to one thing or another, you may even have small payments leaving your account that you have forgotten about. Do an audit and make some decisions about which subscriptions you need and those that you can realistically do without. You could use the extra funds to pay more money off your credit card, thus lowering your debt and putting yourself and your finances in an even stronger position.
Make your credit report your friend
Some of us are obsessed with checking our credit report, others haven’t given it a second look. When it comes to buying a home, one of the first things a lender will do is check your credit history, as it will tell them whether you’re a responsible borrower and in control of your finances. Before you even start to look for a home, make your credit report your friend and see what changes you can make to increase your score. Should you have a low score it can negatively impact the amount of money a lender will be willing to loan you, and even the interest rate they will offer.
Many credit score websites offer a wealth of advice on how to improve your credit rating, so don’t delay – start to make some positive changes as soon as possible.
Are you registered?
With the recent election still ringing in our ears we can’t imagine any of you aren’t listed on the electoral roll. But should you have recently moved into Chelmsford or even neglected to register, you can increase your credit score by making this change. It can take time for this to update on your report, so the sooner you can pop online and get yourself on the electoral roll, the better.
Consider what you buy
Even though you’re looking to move, life still goes on; you may wish to upgrade your car or even have a dream holiday in your sights, but it’s important to not take on large amounts of debt. The amount of debt you have compared to how much money you make can make a significant difference to how much a lender will be willing to loan you. Keeping your debts to a minimum will help to make the process of buying a home a lot smoother.
Do your sums
Being on top of your finances from the start will not only place you in a good position for applying for your mortgage but also set you up for the future. You know your lifestyle and what you enjoy doing on a weekly or monthly basis, as well as your financial commitments. Before you apply for your mortgage set out a budget to work out the maximum monthly sum you can comfortably pay. You may be offered a mortgage that exceeds your desired budget – although this may be attractive at the time, don’t be swayed, as you could risk putting yourself and your family under unnecessary pressure down the line.
Do your homework
There are a variety of products available from a wide range of lenders, and you want to ensure you get the best deal for you and your current circumstances. Whether you’re employed or self-employed, shopping around could save you thousands of pounds. Mortgage brokers can often find deals that are not available direct with some lenders, which is why many of our clients have used our recommended mortgage broker who we can connect you with.
Get into shape
Just as many of us have made a new year’s resolution to get healthy and in shape, why not add your financial health to your list of goals? If you’re looking to move in 2020, getting yourself into good buying shape will help put you in a strong position for when you find your dream home in Chelmsford For more advice give our team a call on 01245 835859.