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Saving for a Mortgage Deposit Shouldn’t be Overwhelming. Here’s what you should do.

Many of us can get by with parting with a fraction of our monthly income as payment towards our mortgage, what is hard to do is saving up to make that first lump deposit that is required of you as a commitment towards accessing the loan.

According to the Land Registry website, the price of an average UK house £215,847,most lenders require you put down 20%of the mortgage sum as down payment. Going by these recent statistics, you may be required to put down at least £43,169.4to access the full amount required to get a house.

The first thing to do when saving up for a house is to figure out how much your mortgage lender will be able to lend you. To determine this amount you need to do an accurate assessment of how much you will be able to repay monthly over the period of the mortgage.

You can use this calculator to find out how much you can borrow.  The calculator will help you determine how much loan you can access by taking into consideration if you are applying on your own or jointly and how much you earn yearly.

Now that you know how much you can access as mortgage, you still need to show your seriousness by putting down a percentage of the needed sum.

As stated earlier, many mortgage lendersrequire 20% down payment, you may get some that may go as low as 5% depending on the uniqueness of your situation. However it is important that you start to work towards achieving that goal.

These steps listed below should guide you:-

  • Assess your finances and work out how much you will be able to save towards achieving your goal. While saving up can be hard, if you go about it the right way, you will find out you don’t have to get so unsettled at the thought of it.
  • Another major thing you have to do is to cut down your expenses. Many of us are guilty of buying stuff that could have been avoided.
  • Keep records of your spendingto adequately plan. Keeping records of what we spend on and how we spend helps in curbing unwanted expenses and also to be in better control.
  • If you need some help with proper allocation of your funds, you may make use of budgeting tools to give you that much desired structure.
  • Make saving towards your new home a top priority. You may do this by opening a savings account dedicated solely towards that. Commit to transferring a decent sum every month till you make the needed deposit.

The most important thing here is for you to plan. Not having a long term goal in place when you set out on the road to buying a house can result in a lot of time being wasted as you try to weigh up every different option without putting a plan in place. Take the time to save and you’ll have your dream home in due course.