Getting on the property ladder as a first-time buyer

Buying your first property is an exciting milestone to reach. The freedom and relief you will experience as you get the keys to your first home will make everything feel worth it. But, how do you actually get there?

Pay off debts

First things first, it’s good to clear any outstanding debts so you can focus on putting money towards your first home. Collate together a list of your debts, including any credit card debts, overdrafts and store cards. That way, you’ll have a clear idea of how much you owe.

If you’re struggling to pay these off, try to draw up a budget and work out your monthly outgoings. Be sure to pay your essential bills first, including your outstanding debts.

Start saving

Try to start saving as early as possible. Put your money into an ISA savings account to earn tax-free interest, increasing your amount of savings where possible.

You could put money aside every month and set up a direct debit to your separate account, treating your savings like another bill. If the money is automatically leaving your account every month, you might not even notice it.

Improve your credit score

Before you consider applying for a mortgage, try to get a copy of your credit score so you know where you stand with potential lenders. 

If you need to improve your credit score, you can do this by closing down credit cards which you no longer use, paying off outstanding debts, ensuring your bills are paid on time and registering on the electoral role.

Ask your family for help

There’s no shame in asking those close to you for a little extra help. Many people move back in with their parents so they can save as much money as possible for their first home.

Some are lucky enough to receive financial help, either through gifts or loans from various family members.

Secure your job status

If you’re in a secure job where you’re earning a steady income every month, this will look great to mortgage lenders. However, it’s important to note that they’ll want to see that you’ve been with your employer for at least six months.

Get government help

There are two main government schemes that could help you on the property ladder:

• Help to buy: The government will offer first-time buyers a loan to help increase the size of their initial deposit. You could borrow up to 20% of the purchase price for a new build.
• Shared ownership: This lets you buy a share of a home from a Housing Association. You will then pay rent to the association on the remaining amount that you owe.