Breaking Property News 23/01/25
Daily bite-sized proptech and property news in partnership with Proptech-X.
Things to think about if you do not want to be a renter for life!
The team behind tlyfe the lifecycle tenant app, not only know a great deal about providing technology that aids tenants to get to the front of the queue when looking to rent their next home, they also know a huge amount about the aspirations of tenants and the roadmap from renting a property to owning a home. They start by explaining that moving forward all depends on building a correct foundation, and finances are key, starting with balancing your finances.
Your credit history Your credit history plays a significant role in building good credit. It takes time to build a positive credit history, and the length of time it takes to build good credit can vary depending on how long you’ve been using credit. Typically, it takes around six months to a year of using credit responsibly to build a good credit history. During this time, you should make all your payments on time, keep your balances low, and avoid applying for too much credit at once.
Your credit utilization ratio Your credit utilization ratio is the amount of credit you’re using compared to the amount of credit you have available. This ratio plays a significant role in your credit score. To build good credit, you should aim to keep your credit utilization ratio below 30%. If you’re starting from scratch, it may take a few months to establish a credit utilization ratio that won’t negatively impact your credit score. However, if you have existing credit cards, you can make changes to your spending habits and start reducing your credit utilization ratio immediately.
Your credit score Your credit score is a measure of your creditworthiness. It takes into account your credit history, credit utilization ratio, and other factors. A good credit score is typically above 700. It can take a few years to build a good credit score from scratch. However, if you have a bad credit score, you can take steps to improve it. Improving your credit score can take anywhere from a few months to a year or more, depending on how much work needs to be done.
Your credit applications Applying for too much credit at once can negatively impact your credit score. Each time you apply for credit, the lender will perform a hard credit inquiry, which can lower your credit score by a few points. To build good credit, you should avoid applying for too much credit at once. Space out your credit applications and only apply for credit when you need it.
Remember, building good credit takes time, patience, and responsible credit use. Depending on your credit history, credit utilization ratio, credit score, and credit applications, it can take anywhere from a few months to several years to build good credit. The key is to use credit responsibly and consistently, make all your payments on time, and avoid applying for too much credit at once.
One of the best ways to help build your credit and prove your mortgage readiness is to be able to prove your ability to pay. One way to do this is through recording your rental payments via tlyfe directly to the various credit reference agencies.
Sooner or later may decide it is time to take the leap and buy a home, rather than rent it. Many people who are tenants then in time become buyers of property, and this is when they need to transition from having a great credit history to getting mortgage ready! Buying a home is a major milestone in most people’s lives. However, it can be an intimidating process, especially when it comes to getting a mortgage. To make the process smoother and more manageable, it’s important to get mortgage ready. Here are some tips to help you get started.
Again you need to Check Your Credit Score Your credit score is one of the most important factors that lenders consider when you apply for a mortgage. A good credit score will not only help you qualify for a mortgage but also help you get a lower interest rate, which can save you thousands of dollars in interest over the life of your loan.
To check your credit score, you can use one of the many free online credit score services. If your score is low, take steps to improve it, such as paying off outstanding debts, disputing errors on your credit report, and making sure to pay all bills on time.
One of the best ways to help build your credit and prove your mortgage readiness is to be able to prove your ability to pay. One way to do this is through recording your rental payments via tlyfe directly to the various credit reference agencies. Click here for more information on how we can help with this!
Assess Your Finances Before you apply for a mortgage, it’s important to assess your finances. This includes evaluating your income, expenses, debts, and assets. Lenders will want to see that you have a stable income, manageable debt-to-income ratio, and enough money in savings to cover closing costs and other fees. To get mortgage ready, create a budget and start saving money for a down payment. Aim to save at least 20% of the home’s purchase price, which will not only help you avoid private mortgage insurance but also make your monthly payments more affordable.
Gather Your Documentation When you apply for a mortgage, you’ll need to provide a lot of documentation. This includes your bank statements, payslips, tax returns and even references. To get mortgage ready, start gathering these documents early and make sure they are up-to-date. You’ll also need to provide information about the property you want to buy, such as the purchase price, property taxes, and insurance. Having this information ready will make the application process smoother and faster.
Research Mortgage Options There are many different types of mortgages, each with its own pros and cons. To get mortgage ready, research your options and determine which type of mortgage is best for you. Consider factors such as the interest rate, the length of the loan, and the down payment requirements. You may also want to get pre-approved for a mortgage, which can give you an idea of how much house you can afford and make
you a more competitive buyer.
Work with a Mortgage Professional Finally, to get mortgage ready, consider working with a mortgage professional. A mortgage broker or loan officer can help you navigate the mortgage process, answer your questions, and help you find the best mortgage for your needs. By following these tips, you can get mortgage ready and make the home-buying process smoother and more manageable. Remember, buying a home is a big investment, so take the time to do your research and make sure you’re making the best decision for your financial future.
Save for a deposit: Saving for a deposit is one of the biggest hurdles for many first time buyers. The larger your deposit, the more options you will have when it comes to finding a property and securing a mortgage. Aim to save at least 5-10% of the property’s value, although a higher deposit will be beneficial.
Getting a mortgage agreement in principle helps. A mortgage agreement in principle is a statement from a lender that they would be willing to lend you a certain amount of money. This can help you understand how much you can afford to borrow and make your property search more focused. You can also consider government schemes: There are several government schemes available to help first-time buyers get on the property ladder, including Help to Buy and Shared Ownership. These schemes can help you afford a home that may otherwise be out of your budget.
Research the housing market: Research the housing market in your desired area to get a better understanding of property prices, demand, and supply. This can help you make informed decisions when it comes to finding a property and negotiating an offer.
Work with a trusted estate agent: A good estate agent can help you navigate the housing market, find suitable properties, and negotiate offers. Look for an estate agent with experience in your desired area and who comes recommended by other buyers.
Be flexible: Be prepared to compromise on some of your must-haves in a property. A willingness to compromise can help you find a property within your budget and get on the property ladder sooner. Getting on the property ladder can take time and effort, but it’s a worthwhile investment in your future. By saving for a deposit, checking your credit score, getting a mortgage agreement in principle, considering government schemes, researching the housing market, working with a trusted estate agent, and being flexible, you can increase your chances of finding the right property at the right price.
Andrew Stanton Executive Editor – moving property and proptech forward. PropTech-X
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