House finance

House finance information

The basics

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 remortgage 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 with everyone, so you can find some useful information, be careful of scams and bitter people, make sure you use it as part of your decision and do not base your choice solely on the word of others.

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 and 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 and if you can't talk to your creditors as most will be understanding and having a clear credit record will help you get a better mortgage rate and help with the stress of gaining credit in the future.

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.