First Time Buyer - Advice much Appreciated

davesmith_2

Hi

Just wondered if there were any experts who could give us some good advice please.

My partner and I have opened a Nationwide save to buy account which gives the possibility for a 5% mortgage, although to be honest we are not sure if we will be able to afford a big enough deposit to actually buy so renting might be the most realistic way forward.

We will have around £6000 as a deposit for a £80,000 house plus we have extra for fees etc.

But the other thing that worries us and may stop us getting a mortgage it that neither of us really have a credit history, I am 28 she is 26, we have never had loans, overdrafts, etc only bank accounts so will this be a big problem?

Many Thanks

kingstreet

Get a credit card and use it to build some positive history while you are saving. Pay it off in full each month, so you pay no interest.

Thrugelmir

davesmith wrote: »

But the other thing that worries us and may stop us getting a mortgage it that neither of us really have a credit history, I am 28 she is 26, we have never had loans, overdrafts, etc only bank accounts so will this be a big problem?

Many Thanks

Using the NW account will build you an adequate credit profile.

MoneyHungry

Get a copy of credit reports, and book an appointment with the bank to see if there is a chance for a mortgage, however I think they are very strict with their 95% ones

kingstreet

Thrugelmir wrote: »

Using the NW account will build you an adequate credit profile.

I thought it was only a savings account?

davesmith_2

thank you for the help

No never had a phone contract, never had anything other than savings and current accounts with Halifax.

I bought a credit report the other month and there was hardly anything on it lol.

Lokolo

kingstreet wrote: »

Get a credit card and use it to build some positive history while you are saving. Pay it off in full each month, so you pay no interest.

This is a good idea as long as you are still saving. If you are planning on buying in a months time then not so useful.

kingstreet

Lokolo wrote: »

This is a good idea as long as you are still saving. If you are planning on buying in a months time then not so useful.

Yes. In principle, you are correct.

Given they have insufficient deposit for the purchase price mentioned and the Nationwide STB appears to be a recent addition, I guessed we are some months away from a possible application.

Thrugelmir

kingstreet wrote: »

I thought it was only a savings account?

Old fashioned lending principles.

Potential borrowers demonstrating an ability to save on a regular basis is a major plus. As it shows management of personal finances.

Some of us remember when saving with the local building society for 2 years was the way of qualifying and securing a mortgage.

Something I suspect will return in a different form in the future. As lenders return to funding mortgages from retail rather than wholesale money markets. Which was the case until 2000.