If you are looking to get a new property or even to get your first property, it is highly likely that you are going to be doing so with a mortgage. I bought my first property 3 years ago and thanks to the team at Accelerate Mortgage, the process of obtaining that credit was incredibly simple. Despite this simplicity there was a great deal which I learned from this experience, and there is actually a great deal which you have to know before you even apply for a mortgage.
If you are looking to get yourself a property, here is what you need to know about getting that mortgage.
Your Credit Score
Checking your credit score is the first place to start here because this is what will dictate how much you are allowed to borrow. Unfortunately there are a lot of people who fail to do this and the result is that they see properties which they like, without recognizing the fact that their credit score will not allow them to borrow as much as they would like. Checking your credit score first enables you to understand exactly what you can expect to borrow.
During the term of your mortgage it will be important that you have some options around payment conditions. For example it may be that you wish to overpay some months if you come into a bit of money. Alternatively you may wish to take a mortgage holiday if you come into some difficulties with your health or your job. In such a situation the mortgage vacation will allow you to not pay the mortgage for a couple of months.
The higher percentage deposit which you can put together, the better a mortgage option you are going to find. This is why so many look to borrow money from family and save up as much as possible, so that they can reduce the amount of interest which they pay back on their mortgage.
Overall Cost and Term
The overall cost of the mortgage and the eventual term of the mortgage will depend on many factors. Age will have to be taken into consideration here, banks or mortgage providers won’t give a 30 year term to a 50 year old for example. Beyond this the mortgage type will make a difference, and regarding cost, the shorter the term the better. If you take on a mortgage over 25 ears rather than 30 years for example, then you are going to be paying far less interest overall, which then reduces the overall cost of the mortgage.
It is important that you make a realistic budget based on how much you earn and how much you can realistically pay off each month. Once you have the mortgage, overpaying it will be the best way to reduce the overall cost and to become the 100% owner of the property as soon as possible. Educate yourself before you apply for your mortgage.