Other ways onto the property ladder
There are a number of ways that could help you onto the property ladder. They all have their pros and cons - but are worth finding out about.
Buying with friends
Ever thought about buying with a mate or a group of close friends? It's one way to get on the property ladder sooner and at least your renting days will be history! It also means you'd be living with friends who you know and trust.
Back to top
Parents as guarantors
You could consider asking your parents to be guarantors on your mortgage. Basically, a guarantor is someone who guarantees to repay the mortgage if the borrower can't or won't for any reason.
This is usually a short-term option. You can request to remove a guarantor at a later date, when you are financially able to pay off the mortgage yourself. It is a good idea to get some legal advice if you decide to look into this option.
Back to top
Shared ownership
One way to get on the property ladder is to buy your home on a shared ownership basis. For example, you could own 75% while someone else (usually a Housing Association) owns the rest. You pay a mortgage on your 75% and rent on the other 25%. You may also have the option to buy more at set times.
To find out more about this option, speak to the local housing association in your area.
Back to top
Shared equity
With this type of scheme you'd buy a property at a discounted price, for example 90% of the purchase price. Then someone else (such as the property developer) holds a second mortgage on the property for the other 10%. This means that when it is eventually sold they would receive 10% of the property's new value.
To find out more about this option, speak to the local housing association or developers in the area. Now you're ready to visit the estate agent
Back to top
Start by reducing your outgoings
Ideally you would pay off any existing personal loans, credit cards and store cards before you apply for a mortgage, so you can borrow the maximum amount. Unfortunately life's not always that simple, so consider rolling your debt into one monthly payment with the lowest possible interest rate.
Check your credit rating
If you've had problems with your credit in the past, even a few missed payments on your credit card for example, this may reduce how much you could borrow. The first thing to do is to contact the credit reference agency and ask for details of your credit file, which they have to provide by law. The credit reference agency for Halifax is www.experian.co.uk. Once you have all the details, you can then sit down with one of the Mortgage Advisers at Halifax to get some helpful advice.
Can you put down a bigger deposit?
This could really work in your favour, as it means you could be offered a much better rate of interest. You may even be able to afford a bigger or better property.
Borrow over a longer term
You could also extend your mortgage term beyond the standard 25 years. Most lenders do offer a term of up to 40 years.
Your home may be repossessed if you do not keep up repayments on your mortgage.