Whether you call it a down payment or a deposit, one thing is clear — if you really want a home in the UK, you’re going to need to save up for one! Gone are the days where you really could get a mortgage fully financed to the point where you really don’t need a downpayment. The more you put down as a mortgage deposit, the lower rate of interest you should be charged. Remember that you’re making sure that you take some of the risk away from the mortgage provider. IF you try to get 100% financing, then you’re really not taking any of the risk away. That means that even if you do get the loan approved, you’re going to pay a lot in terms of interest. And when we’re talking about thousands of pounds at stake, there’s a lot more interest than you think.
Most of the time, a typical deposit is up to 20 percent, but if you can put down more you definitely should! This means that if you had a purchase price of 150,000, you would need to put down 30,000 deposit.
Many parents know how hard the market is for their children to purchase their first home, which is why they make sure that they offer some help with it. These gifts can boost the size of the mortgage deposit, and every little bit helps!
No, this isn’t something that you’re going to be able to save for overnight — many people work very hard all their lives to save up for their first home.
You need to also think about the financial situation that you have currently. Some people find that they can spend more money towards their upcoming mortgage deposit if they would just aim for lowering the bills that they already have. When you’re in a lot of debt, not a lot of money can actually go towards saving anything.
If you can get extra work here and there through friends or even a second job, then you should definitely explore that option as well. We know that it can really be difficult to actually save up for the deposit on your home, but it’s definitely worth it at all costs — check it out today!