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Today I’m going to share four top tips for first-time buyers saving for their first home
Soaring rents, high house prices and the Central Bank’s minimum deposit requirements have meant that it’s particularly difficult for first-time buyers to save up enough money for property purcahse in the current environment.
So here are four top tips to help you best prepare for that big purchase.
One – Set up a regular saver account
The first thing a bank will do when considering you for a mortgage is look at the last 6 months of your financial statements. And they will be impressed if they see consistent and disciplined savings habits, even if it’s just a small amount that you’re putting away.
EBS is currently offering a 3.00% return to regular savers and KBC is offering 3.5% to savers who hold a current account with the bank.
Two – Approach signup incentives with caution
Most of Ireland’s major banks are offering cashback to new mortgage customers at the moment, with as much as €4,000 cash offer for someone taking out a €200,000 mortgage.
These are can be very tempting offers, but it’s essential to consider the repayment rate you’re signing up for and the overall lifetime cost of your loan.
Three – Switch gas and electricity suppliers
Lowering your household bills will of course help you with your saving for a deposit.
Energy bills can be one of the biggest expenses a household faces every year and an incredible 85% of people are still paying more than they have to. There’s up to €360 to be saved by switching today. I don’t know any first-time buyers who wouldn’t like that bit of extra cash to put towards their deposit.
Four – Shop around for mortgage protection insurance
Once you get your first mortgage, you’ll also have to get mortgage protection insurance. Most people buy this directly from their lender out of convenience, but you don’t have to! By shopping around, you could save up to €190 a year if you’re a non-smoker and even more if you’re a smoker!
There you have it, it can be really challenging to save up for your first home in the current environment, but by saving regularly, considering the lifetime cost of your loan and lowering your household bills, you’ll be placing yourself in as strong a position as possible to get your first home.