2022 is already shaping up to be another competitive year for the housing market, with more buyers than sellers competing for properties. If you are a first-time buyer, you will need to put yourself in the best position for competitive negotiations and potential bidding wars. Keep reading for some tips on setting yourself up as an attractive buyer.
Stay in Your Job
If you are considering both new employment and housing opportunities for 2022, consider your timing carefully. It’s essential to have been in continuous employment for at least a year when applying for a mortgage. The details of your employment history are important to financial institutions when considering your eligibility for a mortgage. Even changing contracts within the same company can have an impact on your application, so hold off on any major changes until you have been approved for your mortgage. It is not impossible to get approved for a mortgage with a new contract, but it will limit your options. So don’t get fired or change jobs until you have been approved for a mortgage in principle.
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Secure a Mortgage in Principle
Pre-approval or mortgage in principle (MIP) confirms how much you may be able to borrow for your mortgage. This is not a guarantee of your mortgage, but rather it will reassure estate agents that you will be able to get a mortgage and for what amount. It is important to get pre-approval at the very beginning of your home search. A MIP is an important tool for real estate agents to help negotiate with sellers. It will also give you an advantage over buyers who don’t have a MIP, giving you an important edge in this competitive market. You can get a mortgage in principle from a mortgage broker like Trussle to see what you can afford. Remember that usually, your MIP will last for around three months, so you may need to revisit to renew your MIP.
Keep a Good Credit Score
Lenders will consider your credit score and history when considering your eligibility for a mortgage, including credit cards, outstanding loans, and how consistent you are at making repayments. You can check your credit score in advance with an agency like Experian or Equifax. Missed and late payments will have a considerable negative impact on your score, so keep your credit cards paid on time each month. Lenders will check your credit reports, so make sure it is as clean as possible. Do not take out any new credit for at least three months before starting your home search.
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Choose the Right Real Estate Agent
Of course, you can do your own research and get a good idea of what is happening in the local property market, but a local real estate agent has unmatched expertise in the local market. A real estate agent knows how to understand your needs and negotiate the best possible price for you. Experienced agents understand how to recognize potential problems with a property that might prove to be very costly in the future. A highly rated real estate agent will have reliable market research, including school districts, neighborhood demographics, and the real sale potential.
