House and home finance is a daunting business. In the past 10 years most people have been able to buy a house, decide on a mortgage and then just get on with the everyday tasks of paying the bills. With the increase in costs and the overall world market we have seen a change recently that has made people think more about their house and home finance.
The recent rises in the interest rates nationally have meant that people are paying more for their mortgage, people are starting to re-mortgage to get a fixed rate and those who got a fixed rate more than a year ago are now most probably beating the Bank of England base rate.Research
House finance is a mine field and shouldn't be taken lightly. You should always seek advice from a specialist when considering any mortgage, loan or loan secured on your home, shop around and get a different view point. Make sure to talk to friends and family, they will give you the truth about the people they are with.
The internet has become a major resource for finding information. More and more people are getting online and sharing their experiences which can lead to some very useful information. But you do need to be careful not to be taken in by scams, fake reviews and the like. Make sure you use the information you glean from surfing the web as part of your decision making, rather than basing your choice solely on what you find there.Insurance
When taking out a mortgage, you will be offered many types of insurance products from household to life cover. Depending on whom you are going with, you may or may not get a good deal. Some mortgage companies will request you take their deals on insurance to get you a better deal on your mortgage. This is because they can offset some of the reduction on your mortgage by making money on the insurance you take it. Normally you can get out of this by asking or paying a small one off fee.
When taking out house insurance or related mortgage protection or life insurance, shop around. Make sure you are getting a good deal and more importantly good cover. Maybe use comparison sites to make your life easier as comparing the actual cover benefits in one place will make your job easier.Bills and council tax
Don't forget that when buying or renting a house, you will not just be paying the mortgage or the rent. You have statutory bills to pay like council tax, water rates etc. You will also have to think of electricity, gas and other utilities like phone and internet, sky and other luxury items.
Be prudent and make sure you really can afford the debt you are taking on, think about those unexpected bills like cars, and boilers, children etc. That could upset your budget, one major problem could be the set back you just don't need.Credit scoring and debt management
Most people in the UK have some sort of credit score, this is basically a score given to you based on a number of factors, from your past credit cards, store cards, mortgages etc. There are 3 or 4 companies that your credit brokers (cards, loans, mortgage companies) will use to check your credit rating. Always try to make payments on time. If you get into financial difficulties it's always best to talk to your creditors as quickly as possible. Most will be understanding and arrange affordable payments, as they want to make it easy for you to pay them the money you owe. The real value of this is that having a clear credit record will help you get and lower interest rates with mortgages and other loans.
But, don't worry if you don't have excellent credit scoring. Most of us now have had problems in the past, whether it is late payments or even CCJ's. Lenders are becoming more up to speed on these sorts of errors and will look at people with less than perfect credit. A large percentage of people in the UK have a credit problem, whether they know about it or not.