Are you thinking of taking out a mortgage in the near future? If you are then you should know that your personal circumstances can have a big effect on whether you get a good or bad mortgage deal. Many factors can affect the interest rate, whether it is fixed or variable, the deposit required and other areas. Therefore, it is important to be aware of what personal considerations will play their part and any ways you can change to receive a better deal.
Financial Situation
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One of the first things any mortgage lender will check to see if you are an appropriate person to lend such huge amounts of money to, is your credit score. This takes into account previous borrowing and repayment activity, providing a good insight into your financial situation and personal management. There are simple ways to boost your credit rating but don’t get too obsessed by just this. Having plenty of savings and a good income are just as key to securing a mortgage.
Employment Status
Your employment situation also affects what type of mortgages you can apply for. There are professional mortgages that offer attractive rates and discounts for the likes of doctors, solicitors and other professionals. Those working on short-term or freelance contracts may find it harder to find a good rate, as lenders view them as riskier options. That’s where contractor mortgages help, as they are flexible and designed around those working on short-term contracts. Find out more here about contractor mortgages.
Future Intentions
You may know already that the property you are thinking of purchasing won’t be your long term home. Still, a mortgage is required to help buy it before moving on. A buy-to-let mortgage can be a good idea if you just want to buy a property, do it up and rent out for a profit at a later date for example. This should make the whole process a lot more straightforward, rather than subletting through a standard mortgage.
Additional Costs
There are various additional costs related to a mortgage, such as the repayments, legal costs, arrangement fees, insurance and more. It is likely you will also have personal costs outside your home that need to be considered and factored into a budget. Children, cars, pets and a lot of other things will need enough money saved to take care of them in case of an emergency, which can affect how much you can put towards a mortgage. Make these considerations before meeting with a mortgage broker or advisor.
Raj Kumar is a qualified business/finance writer expert in investment, debt, credit cards, Passive income, financial updates. He advises in his blog finance clap.
