Best way to start off on property ladder

Glacius

Glacius

Glacius

Associate
Joined
6 Dec 2013
Posts
500
Hey All,

Just after some advice or if anyone may have been in roughly the same situation before, I am currently and the nice ripe age of 32, Single, and have just got myself a new job on a fairly decent wage (Most I have been on before) of 30K Per year, I have no huge debts and will have 700-800 spare each month if not more, the down side is I have a bad credit rating (Bad I know) as in the very poor region and every which way I look at things trying to get a mortgage is just a no go it seems and to carry on renting feels like completely dead money to me and the sort of place I would like to move into are between 700-800 a month (Newmarket/Cambridge based) and feels like a hell of a lot of money to throw down each month and not really getting me anywhere.

So the question is are there any other schemes or ways to get into part owning your own home or avenues I can take with a bad credit rating or am I just stuck trying to improve that before my own home could actually become a reality?

Thanks in advance.
 
I don't really have a deposit saved up right now no sadly, but with the new job saving will be very quick (Hopefully) with the spare money each month, and thanks for reply.
 
Stay at home for a few years to build up a deposit. Providing you don't have a lavish lifestyle you could save 90% of your earnings.
 
Glacius said:
I don't really have a deposit saved up right now no sadly, but with the new job saving will be very quick (Hopefully) with the spare money each month, and thanks for reply.
Click to expand...
I'm a massive pessimist when it comes to our broken property market, but you need to come back and ask this question when you have £30-50k saved up. So we'll see you in 4.5 years?

In all seriousness, you need to look at property prices near you and get a deposit of 15-20%. Has no-one explained to you how mortgages work? :confused:

EDIT: Useful part #2, get yourself an ISA asap, and when they are released (April) open one of the new LISAs as well. You can split your tax-free savings across them both, with the LISA offering 25% bonus for a first-time property purchase. You can only put in a max of £4k/yr though. But if you do that you end up with £5k/yr with the bonus.
 
Concentrate on saving the deposit, maximising your HTB ISA, and repairing your credit history.

If I may ask what's made it so low? Is it previous problems or simply a lack of history?

I turned round my mediocre score in around 2-3 years whilst saving for our deposit.
 
As said above start right now you need to improve your credit rating, time goes faster than you think so while your waiting to get on the property ladder you might as well repair your credit rating, I have been doing the same recently, use a credit card sensibly and pay it off in full every month, pay for a cheap mobile phone contract if you don't have one already and keep payments up, order a copy of your credit report from Experian to see and what you need to concentrate on fixing, and while doing this save save save, the bigger the deposit you have the better chance you have getting a mortgage with a less than perfect credit and also it's nice to have more of the property paid off from the get go.


Download this guide - http://www.moneysavingexpert.com/mortgages/mortgage-guide

I'm not sure if you have anyone that can help you but barclays offer whats called a family springboard mortgage - http://www.barclays.co.uk/mortgages/family-springboard-mortgage


Also this was quite an interesting petition that has already gained nearly 150 thousand signatures, it is a proposal to make paying rent on time proof that you are able to meet mortgage repayments, it's a nice idea although sadly I never have a lot of faith in these petitions.

https://petition.parliament.uk/petitions/186565 -
 
Last edited:
What is keeping your credit rating low? is it defaults?

A default takes 6 years to clear - use this time to save a deposit.

if you have 800 spare a month:

500 x 12 = 6,000 a year to your deposit

I got a £250,000 mortgage with £25,000 - you can get this in 4 years from nothing.
 
A lot of the issues around the credit rating being low was being out of work for 4 almost 5 months and bills getting rather out of hand and having to rely on payment plans etc will have all marked and completely ruined my credit rating, which is annoying as I am now in a much better/great position personally regarding my finances and income.

Short of it is try and repair my credit rating and get an ISA asap and put as much savings in there as I can as often as I can in order to get a hefty deposit?
 
Glacius said:
A lot of the issues around the credit rating being low was being out of work for 4 almost 5 months and bills getting rather out of hand and having to rely on payment plans etc will have all marked and completely ruined my credit rating, which is annoying as I am now in a much better/great position personally regarding my finances and income.

Short of it is try and repair my credit rating and get an ISA asap and put as much savings in there as I can as often as I can in order to get a hefty deposit?
Click to expand...

go to noddle.co.uk and check your credit rating, but realise - your credit rating will be fine by the time you have finished saving up.

payment plans aren't as bad as a default. I had a few defaults on me for 6 years, all cleared by the time I got my mortgage.
 
I did also hear about that petition regarding rent payments but like yourself I have never really had to much faith in petitions actually accomplishing anything :(

No defaults on my history at all thank god just late payments from previous months and fact I have moved to different rental properties over last few years I am guessing and not sure if this effects my rating but the owner of the last house I rented has been declared bankrupt and was blacklisted.
 
Regardless of your credit rating you're stuck without a deposit, so the first port of call should be saving up for that. If you're starting with '0', by the time you have enough for a deposit chances are your credit rating will have improved (depending on how you manage it from now, until then obviously).
 
Cheers for the quick advice, guess I will be getting my saving hat on now the new job has started and hopefully in that time try improve the credit rating as quick as I can and go from there, I am hoping the payment plans I had been on previously haven't added any defaults or anything lasting 6 years to my account... best get on to Experian and find out.

Does having a larger deposit effect the chances or actually getting a mortgage or does it effect the amount they will give you?
 
get a standing order to take from your account the day the money comes in, so it goes into your savings account.

I have 3 accounts:
account 1: money goes in here my main account (day to day spending) dumps enough money for all my bills into my 2nd account
account 2: Personal bills account, all my creditcards, mobile phone and contractual bills for me come out here, this also pays into our joint account (3)
account 3: Joint account of me and my partner, all house bills, mortgage, joint contracts like finance comes out of it.

All standing orders are done at the 1st of every month which lets me analyse spending.
 
You must log in or register to reply here.
Back
Top Bottom