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How To Get Onto The Property Ladder Faster

Wednesday 31st March 2021

Owning a property is a major dream for many people, but with house prices on the rise and mortgages harder to get approved for, it’s not always an easy ride.

However, the good news is that there are several things that you can do to improve your chances of being able to purchase your own home and get onto the property ladder.

Firstly, you will need to ensure that you qualify for a mortgage and take steps towards saving for your deposit before you can start looking for a suitable property for you.

Get a Stable Income:

To qualify for a mortgage, you will need to prove that you have a regular stable income.

This means getting a job if you do not already have one or looking for a better-paying job where you can earn more and save more, allowing you to qualify for more mortgage products and helping you to get your deposit together faster. It can be tempting to hold off for the career that you want over the long-term if you have recently graduated but taking any job now will help you reach your goal of property ownership sooner.

Get In Control of Debt:

When it comes to getting on the property ladder, one of the main things that you will need to do is pay down as much of your debt as possible.

How much money you have borrowed and how much you are repaying each month is one of the main factors that mortgage lenders will take into consideration when you apply, so take steps to pay off the debt with the highest interest first and gradually work down. The debt avalanche method is an ideal option to consider if you want to get rid of your higher-interest debts quickly.

Start Saving:

No matter what kind of property you want to buy, you will need to get into the habit of saving as early as possible.

If you want to purchase a property in the traditional way, you will need to get an average deposit of £20-30k together, which can be quite daunting. But the sooner you begin saving money, the sooner you will begin to build your house deposit fund. You may also want to consider government schemes such as the Lifetime ISA that you can use to save for your house deposit and enjoy financial bonuses from the government each year to go towards it.

Improve Your Credit Score:

Your credit rating is another major factor that lenders will take into consideration when you apply for a mortgage, which is why it’s important to take the necessary steps to improve yours if you are planning to buy a house.

You can easily access your credit score free of charge online and determine what you can do to help improve it, whether that’s paying down your debts, removing mistakes and errors from your credit score, or taking steps like getting on the electoral roll.

Making sure that you don’t miss any debt repayments and paying more than the minimum each month on any outstanding credit card debts are both ideal ways to improve your credit score. Bear in mind that some of your regular household bills like gas and electric, water, and broadband expenses can also impact your credit score, so be sure to always pay on time.

Borrow a Small Amount of Money:

While it might seem counterintuitive, if you have never borrowed any money before, your credit score might be low because there is no data to show how you behave when borrowing.

However, this puts you in an ideal position since you can borrow a small amount of money that you will pay back on time and in full each month to build your credit score and demonstrate to lenders that you are responsible. A small-limit credit card, store card or catalogue account, or even a mobile phone contract are all ideal ways to build your credit score if you are borrowing for the first time.

Consider Shared Ownership:

If you are going to be buying a property on your own, are on a low income, or simply want to become a homeowner as quickly as possible, shared ownership could be for you.

Onward Living has a useful guide comparing shared ownership and Help to Buy. Onward Living offers a range of shared ownership homes around the country; these new-build properties are designed so that you can purchase a percentage share of the property at first and pay rent on the rest at a reduced rate.

Over time, you can staircase by purchasing more of the property at a time until eventually, you own it all. You can purchase shares with savings or with a mortgage, which is usually much smaller than a mortgage for 100% of the property and therefore means that most applicants will have a better chance of being accepted.

Getting on the property ladder can seem daunting, however, it’s certainly not impossible with the right preparation and work.