5 Things You Should Avoid Doing If You Are About to Buy A House

It can be very stressful when you’re preparing to purchase a property. After all, there’s a lot to do and arrange, and it can all become a bit overwhelming. However, if you need to obtain a mortgage, you definitely don’t want to drag the process out or even potentially bring it to an untimely end.

It’s vital to bear in mind that your finances and credit rating will be monitored until the loan finally closes, so there are a few things to avoid if you’re about to buy a house. Here are just five of them.

Disrupting Your Credit Score

Each time your credit score is checked by a business, your credit score will register the check and reduce by a few points. This may not appear to be too much of a problem, but if you’re just a few points away from securing your quoted rate or securing an approval, just a couple of loan enquiries could cause you major difficulties. Now isn’t the right time for making enquiries about your credit report, cancelling your cards or paying off any debts.

Opening New Credit Lines

Buying a property means lots of expense, so don’t take on any new debts at this point. Even small debts could throw your debt-to-income ratio off and could end up disqualifying you from your chosen home loan. Don’t take out any new credit or store cards, don’t extend any existing credit lines, and don’t make any other financial changes that could cause your lender to get cold feet. This includes buying a car with a car loan since this will be viewed as another significant debt.

Missing Bill Payments

You should always make sure you pay your bills in a timely manner, but when you’re buying a home, it can be all-too-easy to forget about a payment accidentally. Yet, this could have a serious consequence, particularly if the missing payment is on your mortgage. Even one missed bill months before a mortgage application could cause your credit score to be lowered and jeopardise your chance of getting your loan.

Moving Money Around

If you’re planning to make a large withdrawal, deposit or transfer – don’t! Wait until the sale has completed before you do so since your mortgage approval will be based on your financial circumstances at the time that you applied. Changes made after that time will have an impact.

Changing Jobs

When you’re obtaining a mortgage, you should avoid getting a new job, as this could cause the mortgage lender to question whether or not you’re financially stable. Even a positive change such as taking on a different position at your existing workplace or moving to a full-time role from a part-time one could cause your mortgage lender to think twice.

If you avoid the above five things in the few months before you buy your home, you should have no difficulties securing your mortgage with your chosen lender and when you are ready we can provide you with a conveyancing quote from our panel of leading solicitors.

Why Use a Mortgage Advisor?

Obtaining a mortgage is always going to be one of your biggest financial decisions; therefore, getting it right first time is imperative. With that in mind, you may be wondering if there’s a benefit to using a mortgage advisor. Here, we take a look at why you should consider using one.

Choosing Your Mortgage

There are countless different mortgages in the marketplace today, and understanding what is on offer can be challenging with so many products rates and providers available to pick from. For this reason, speaking to an independent mortgage advisor is often the best course of action as they will be able to give you unbiased advice and an explanation of the different options open to you.

What If I Don’t Get Advice?

If you don’t get advice but decide to do the research independently, you could be putting yourself in a disadvantaged position in the future should the mortgage turn out not to be suitable for your needs. Essentially, you’ll have to bear full responsibility for your own mortgage decisions. If you consult with a mortgage advisor, though, you’ll have far more rights should you have to complain.

Failing to consult with an advisor could end up with you getting the wrong type of mortgage for your needs, which is a very costly mistake. It could also end up with your application being rejected simply because you failed to clearly understand the restrictions or the circumstances that the specific mortgage was designed for.

Why Should I Consult with A Mortgage Advisor?

Mortgage advisors (also called independent mortgage brokers) are specialists in the industry who have an in-depth understanding and knowledge of the mortgage marketplace. They can look at a broad spectrum of mortgage products and determine which ones best suit your requirements.

A mortgage advisor must give you advice and recommend the best mortgage to suit you. You will also be protected and will be able to make a complaint to the Financial Ombudsman should things not go according to plan.

A mortgage advisor will be able to help you avoid some common problems. For example, they will:

• Check your finances to ensure you’re able to afford a mortgage
• Offer you exclusive deals that otherwise wouldn’t have been available
• Complete the documentation on your behalf for a faster, easier process
• Take all the features and costs of a mortgage into account
• Recommend the most suitable mortgage for you
• Let you know which mortgages you’re most likely to be offered

Will I Have to Pay a Fee to A Mortgage Advisor?

Some mortgage advisors offer their services for free, while others charge for their services. Whether or not you’re charged a fee may depend on which mortgage you choose or its overall value. In any case, the advisor should inform you upfront how much you’ll need to pay for using their service. They are also required to tell you whether they will be receiving commission from a lender to recommend their products.

Once you have your mortgage adviser sorted, its time to look at conveyancing, we can help you with that, use our quote tool to get your conveyancing costs in under a minute.

What House Insurance Do I Need?

Although there’s no legal requirement to have house insurance, it’s still a good idea to have some. If you experience a flood, theft or a fire, your insurance will help to cover your costs and alleviate the financial burden at a challenging time.

There are two kinds of home insurance – buildings insurance which covers your home’s structure and fixtures, and contents insurance that covers personal belongings in the property. Both policies can be purchased together or separately. If you have a mortgage, your lender will probably insist you take out buildings insurance cover on the property.

How do you determine the correct type of house insurance for you? Read on to find out some considerations to keep in mind.

Type of Property

Your home influences the type of policy to get. If your property is made of standard construction, the majority of policies will cover you. However, if your property is a little different, a different type of cover may be required. If you live in a thatched house, a house with a flat roof or a listed building, you may need a specific type of cover.

If you’re a tenant rather than a homeowner, you shouldn’t require any buildings insurance since this is the landlord’s responsibility. You should take out a contents insurance policy, though, so your belongings are protected. Students living in university halls of residence or with friends may require a specific type of contents cover.

If your property is very large or expensive, you may require specialist buildings insurance cover as well as a higher level of content cover. Also, if the property you want to cover is a holiday home, you’ll need a specialist policy since most insurers don’t insure any property that is left empty for over 30 days consecutively. This is also the case if you are insuring an unoccupied property.

If you’ve ever made a subsidence damage claim on the property, most insurers won’t cover you. A few insurers will cover properties with subsidence; however, the costs will be higher, as will the excess to pay if you need to claim.

The Amount of Cover You Need

When applying for a home insurance policy, you’ll need to determine:

• Rebuilding costs
• Your contents’ value

You’ll also need to consider whether you’ll need any optional extras added onto the policy. such as:

• Accidental damage cover
• Home emergency cover
• Personal possessions cover for items outside your home, such as your smartphone
• Legal expenses cover

Although these extras will cost you more, they may be well worth investing in depending on your circumstances.

Choosing the Right Home Insurance for You

In order to select the correct policy for your needs, you must:

• Decide whether you require contents, buildings or a combined insurance policy
• Decide whether you require a special policy
• Determine the precise level of coverage you require to protect your contents and buildings fully
• Decide whether you need to add any extras to the policy
• Check how much policy excess you can afford

Once you’ve decided on the right kind of policy for you and the correct level of cover, you should compare products and make a final decision.

If you need expert help for your next moving day, get quotes from our panel of conveyancers in minutes here.