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Tag: buy your first home

Financial Resolutions for Homebuyers and Homeowners in 2025

Posted on December 31, 2024 - 11:00 am by
Financial Resolutions for Homebuyers and Homeowners in 2025

Financial Resolutions for Homebuyers and Homeowners in 2025

The start of a new year is the perfect time to set fresh financial goals, especially if you’re planning to buy your first home in 2025. For many, homeownership is a key milestone—but achieving it requires careful planning, discipline, and the right guidance.

Whether you’re saving for a deposit, working on your credit score, or considering refinancing options, setting realistic resolutions can make your homeownership dreams a reality. Here’s a guide to help first-time buyers get started, with insights into how mortgage advisers can support you every step of the way.

1. Save for Your Deposit

Saving for a deposit is one of the biggest challenges for first-time buyers, but a clear plan can make it more manageable.

Set a Realistic Savings Target

  • Research the average property prices in your desired area to determine how much you’ll need for a deposit.

  • Aim for at least 5–10% of the property value, but keep in mind that a larger deposit can unlock better mortgage rates.

Create a Monthly Budget

  • Track your income and expenses to identify areas where you can cut back.

  • Allocate a fixed amount each month to your savings and treat it like a non-negotiable bill.

Consider Government Schemes

  • Explore initiatives like the Lifetime ISA (LISA), which offers a 25% government bonus on savings up to £4,000 per year for first-time buyers.

  • Check for regional schemes or shared ownership options that could reduce upfront costs.

Adviser Insight

“A mortgage adviser can help you understand how much deposit you’ll need and identify schemes that fit your situation. Don’t hesitate to ask for guidance early on.” – Emily R., Mortgage Adviser

2. Improve Your Credit Score

Your credit score plays a crucial role in securing a mortgage, so making it a priority in 2025 is essential.

Check Your Credit Report

  • Use free services like Experian or Equifax to review your credit report.

  • Look for errors or outdated information and get them corrected.
Improve Credit Score

Pay Bills on Time

  • Set up direct debits to ensure all payments are made on time, as missed payments can lower your score.

Reduce Debt

  • Focus on paying down high-interest debt, like credit cards, before applying for a mortgage.

  • Avoid taking on new credit in the months leading up to your application.

Limit Credit Applications

  • Multiple credit checks can lower your score, so space out applications for loans or credit cards.

Adviser Insight

“Many first-time buyers worry about their credit score. A mortgage adviser can recommend steps to improve it and even connect you with lenders who are more flexible.” – James T., Mortgage Specialist

3. Understand Your Mortgage Options

Choosing the right mortgage is a key part of your homebuying journey. Understanding your options early can save time and stress later.

Fixed vs. Variable Rates

  • Fixed-rate mortgages offer stability, while variable rates may provide savings if interest rates drop.

  • Discuss your risk tolerance and long-term plans with your adviser to choose the best option.

First-Time Buyer Mortgages

  • Many lenders offer products tailored to first-time buyers, including lower deposit requirements or cashback incentives.

Government Help

  • Look into Help to Buy or shared ownership schemes, which can make getting on the property ladder more affordable.

Adviser Insight

“A mortgage adviser can compare hundreds of deals to find the best one for your circumstances. They’ll also guide you through the application process to ensure everything runs smoothly.” – Sarah P., Mortgage Consultant

4. Plan for Additional Costs

Buying a home involves more than just the deposit and mortgage. Budgeting for additional expenses will help you avoid surprises.

Key Costs to Consider

  • Stamp Duty: Check if you qualify for first-time buyer exemptions.

  • Legal Fees: Solicitors typically charge between £1,000 and £1,500.

  • Surveys: Depending on the type of survey, costs can range from £250 to £600.

  • Moving Costs: Factor in removal services, new furniture, and utility setup fees.
Additional Costs

Adviser Insight

“We always remind first-time buyers to budget for extra costs. Knowing what to expect can help you feel more prepared and confident.” – Daniel M., Senior Adviser

5. Build a Relationship with a Mortgage Adviser

A qualified mortgage adviser can be your biggest ally in achieving your homeownership goals.

Why Work with an Adviser?

  • Tailored Advice: Advisers assess your unique situation and recommend the best mortgage products.

  • Access to Deals: Many advisers have access to exclusive rates not available directly to the public.

  • Guidance Through the Process: From paperwork to lender negotiations, an adviser simplifies the journey.
Is Being a Mortgage Adviser Right for You?

When to Contact an Adviser

  • Reach out as soon as you start saving for a deposit or improving your credit score. Early guidance can save time and money in the long run.

Adviser Insight

“First-time buyers often don’t realize how much a mortgage adviser can help. We’re here to make the process less daunting and ensure you get the best deal possible.” – Priya S., Mortgage Adviser

Checklist for First-Time Buyers

Here’s a quick checklist to keep you on track:

  1. Set a Savings Goal: Determine your target deposit and start saving monthly.

  2. Check Your Credit Score: Review your report and take steps to improve it.

  3. Research Mortgage Options: Learn about fixed, variable, and first-time buyer products.

  4. Explore Government Schemes: See if you’re eligible for a LISA, Help to Buy, or shared ownership.

  5. Budget for Extra Costs: Account for legal fees, surveys, and moving expenses.

  6. Speak to a Mortgage Adviser: Get expert guidance tailored to your situation.

FAQs for First-Time Buyers

Q: How much deposit do I need to buy my first home?

A: Most lenders require at least 5–10% of the property value. A larger deposit can improve your chances of securing a competitive mortgage rate.

Q: How can I improve my chances of getting approved for a mortgage?

A: Focus on improving your credit score, reducing debt, and saving for a larger deposit. A mortgage adviser can also help you identify lenders that align with your financial profile.

Q: Are there any special mortgage products for first-time buyers?

A: Yes, many lenders offer products designed for first-time buyers, including lower deposit requirements and cashback incentives. Ask your mortgage adviser about these options.

Q: When should I start working with a mortgage adviser?

A: Ideally, reach out 6–12 months before you plan to buy. This allows time to prepare your finances and explore the best options.

Q: What’s the difference between fixed and variable-rate mortgages?

A: Fixed-rate mortgages offer stable payments over a set period, while variable rates may fluctuate based on market conditions. Your adviser can help you decide which is right for you.

Final Thoughts

2025 can be the year you take meaningful steps toward homeownership. By setting realistic financial resolutions—saving for a deposit, improving your credit score, and understanding your mortgage options—you’ll be well on your way to achieving your goals.

Remember, you don’t have to navigate this journey alone. A qualified mortgage adviser can provide the expertise and support you need to make informed decisions and turn your homeownership dreams into reality.

Ready to take the first step? Contact a mortgage adviser today to start planning for your future.

Are you considering becoming a mortgage adviser?  We’re here to help!