Finding the Best Home Loan Deals for First Time Buyers
Home loans aren’t easy, especially for first time buyers who know nothing about them. Not only do you have to find a good deal on home loan rates, but your offer will also need to be accepted, too. There are ways to increase the chances of getting your offer accepted however, and they can make a huge difference.
You’ll need to pay money for a deposit up front unless you are looking for a no deposit loan, which is basically a percentage of the amount agreed to for the property in question. Usually, a bank will lend you 95 percent of the property’s value and the other 5 percent will have to be paid by you (this amount is the deposit).
Even though you could pay 5 percent, you could get a better home loan rate if you’re able to pay more. The best rates are usually only available to people who can put down a 40 percent deposit.
No matter how much you want to put down for the deposit, you should make sure that you have at least 5 percent of the property’s value set aside, as it’s the least that you will be likely to put down.
How much can you afford?
It’s important to know how much you will be able to afford when comparing home loans. Without knowing how much you can pay, you could find your dream property and then realise that you won’t be able to afford it. For this reason, it’s a wise idea to work out how much you can afford before you look for a house, because knowing the amount that you can pay will give you an idea of how much you’ll be able to borrow.
Not only that, but most banks will want to know (and also have proof of) how much money you make and how much money you spend. Also, your credit score can affect the chance of getting your loan accepted, too.
The extra cost of home loans
There are also extra fees that come with home loans, too. Banks will often charge an arrangement fee for your mortgage and there are also the costs of things for your home (such as furniture and decorations), too. Plus, if you use a broker, then you may need to pay even more money out.
Knowing how much you’ll need to pay for the extra bits could help you to be a bit more prepared, as well as help you to avoid getting into debt. Check out UnoHomeLoans for more details