How to get on the property ladder

From Credit Scores to Money Saving Tips and Mortgage Brokers.

It can be a very daunting process. Not only is buying a property one of the most stressful things that you can do (sorry I won't sugar coat it!) but it's also something that you have to work towards for years before you even realise that's what you're doing! Never fear, though. There are things you can do that will make it feel like you're effortlessly making your way onto that property ladder. Read on to find out what I mean.

Forward Planning

“... it's something you have to work towards for years before you even realise that's what you're doing!”

I bought my house, the first and only one so far, with my husband at the age of 29. I had been preparing for that moment since I was 22; not the husband bit, I was a bit of a man-hater at 22! Luckily for me, I happened to have an older brother and sister, 6 and 8 years my senior, who had bought their first properties. Watching them go through the process taught me what I needed to do in order to get onto the property ladder #firsttimebuyer

It's never too late to get started on building your credit score

Let's start things off with something simple. Credit cards. This is the easiest way to build up your credit score without any real effort. Even store cards are a great way to show lenders that you can pay off your bills every month. After all, that's the point. Mortgage providers want to see that you can manage your money and pay your bills before they lend you 100s of thousands of pounds (I'm in the UK for any international readers). Makes sense doesn't it?

Now that you understand the why, let's move on to the how...

“Credit Cards. This is the easiest way to build up your credit score...”

It's not just simply having a credit card or store card; you have to use them. I know that it can be scary and I've met so many people in my life who have told me that they don't have credit cards because they don't trust themselves. Well then, neither will the banks.

An easy solution is to use your credit card for something mundane and regular. Petrol or train tickets for example. If you're filling your car up every week then pay using your credit card and just transfer the money over at the end of each week. Or use your credit card for the weekly shop. Simple. You'll be building up that trust with the banks in no time.

I also happen to love store cards as not only do they work in the same way but there are often perks like earning points with them when you use their card, which can be exchanged for vouchers. I love the John Lewis Partnership card, it's basically a credit card but they send me vouchers every now and again!

The only thing to be aware about is to not let the payments go late as otherwise not only could you go into arrears and get yourself a late fee charge but it could potentially impact on your credit score. So that's why if you find something that you'll be regularly spending your money on anyway, use your credit card and pay it off each week. Once it's a habit you won't even think about it. You could even set up a direct debit if you're worried about missing the payment.

Council Tax & Electoral Vote

I stand corrected, THIS is the easiest way to get a good credit score. Just by telling the government where you live and registering to vote (both things you should do anyway!) you're helping mortgage providers work out if they have anything to worry about. If you've been good at paying your council tax and utility bills for your whole adult life (I can't remember how many years they go back but from my last Experian check they asked for every address I had lived in since I was 18) then you will get a strong score. On the other hand, if you were regularly late at paying any of your bills or have anything that's still outstanding on a previous address... well then you will have a very poor credit score.

“Experian... tell you if you have any unpaid bills at your previous addresses.”

That leads on to my next point... if you have any concerns about your credit score then there are many companies that offer services. Experian for instance, is one that I've used in the past and they calculate your credit score based on everything I've spoken about above... and they tell you if you have any unpaid bills at your previous addresses. This gives you a chance to fix the problem before it becomes a surprise when you apply for your mortgage in principle.

ISA

I will do a whole other post on deposits but first, if you're serious about saving for a deposit then you will find keeping the money all in one place so much easier. Especially if you can find a place that will earn you interest and (hopefully) put you off from dipping into the honey pot every now and again to fulfil your shopping spree urge! I am personally not eligible for some of the schemes out there so I can't offer advice on those but your bank will be a great place to start. See what they have on offer in terms of ISAs or help-to-buy schemes and start from there.

Mortgage Broker

We were incredibly lucky that my husband's cousin is a mortgage broker. So we didn't have to search for a good one we could trust; we already had one! If you are completely new to the process I couldn't recommend this enough. I didn't know where to start with buying a house. I was great at all the prep-work I've already mentioned. The actual process and what I needed to do and when, however, that was a whole other kettle of fish! (excuse my English slang for those of your who aren't used to the quite frankly bizarre English sayings we have!)

A Mortgage Broker will be on top of all the current deals and will be able to recommend the best rates and mortgage providers that are the most suitable to you and your purchase. Not only that, but they organise everything for you, so all we had to do was select from his recommended list, send over all our bank statements, read the documents and sign. The whole process gave us peace of mind. Invaluable.

If you're interested in learning a little more then I have another blog post called "Saving a deposit"

Lucy's Hillside House | Content Creator & Blogger