What Can
You Afford?
Now that you
have a fairly good idea of how much your ideal property is going
to cost, you will need to find out if you can afford it.
The majority
of people use a combination of a deposit and a mortgage to buy
their first home. The deposit is normally between 5% and 10% of
the purchase price. Finding a mortgage provider who is prepared
to lend you the full mortgage without a deposit is trickier and
you are likely to incur a higher rate of interest to protect the
loan.
How much can
you borrow? - The amount of money that you can borrow depends
on your individual circumstances, but the following factors will
help determine the overall amount:
- Your salary
- Your deposit
- If you
are buying on your own or with a partner
Many mortgage
companies provide online calculators, so that you can get an idea
of how much you will be able to borrow, take a look at our mortgages
page for more information.
Once you have
received a few estimates, you can compare the amount that you
can borrow, with the cost of your ideal home.
You may find
that you cannot raise enough money to purchase the home you want
and will need to look at other options, such as:
- Buying
in a cheaper area
- Buying
a smaller property
- Continuing
to build up your deposit until something suitable comes along
