Top tips for saving a deposit

With 100% loans a thing of the past, homebuyers now need to stump up 5% or even 10% of the property value, in order to get a decent mortgage. Buyers with a reasonable sum of cash behind them are not only better placed to weather any dips in prices, they have a much greater choice of lending deals available to them, so it’s more important than ever to build up the biggest deposit you can.

Mike Bottomley, National New Build Manager at the Halifax Bank, offers this advice to buyers hoping to give their savings a boost:

“Planning is the key. Speak to a mortgage adviser first of all, or use an online loan calculator such as the one on the Halifax Bank website, to work out how much you will be able to borrow. Then, research prices in the areas where you would like to buy, to get an indication of what you can afford and how much deposit you will need.

“Even if buying your own property seems like a long way off, it’s a good idea to start thinking about your deposit sooner rather than later. Saving can take a long time, so work out how long it will take to reach your target and be patient – don’t commit yourself until you are ready.

“A good way to get started is to put away the amount you would need for your mortgage repayments each month, as this will not only get your deposit going, it will help prepare you for the financial commitment.

“Finally, make the most of your savings by taking advantage of a tax free ISA or high interest savings account.”

Some other top money saving tips include:

- Keep a record of every single penny you spend for a month, you’ll learn a lot about your spending habits and may find ways to cut back on unnecessary costs.

- Don’t settle for unsatisfactory goods or services – complain!

- Switch suppliers. Make use of websites such as moneysavingexpert.com to compare gas, electric and mobile phone providers, then use the information to negotiate a better deal.

- Use the four day rule to reduce ‘whim’ spending. Wait for at least four days before making any big purchases, as the delay will give you time to reflect.

For anyone looking to move immediately, McDermott Homes recently launched an innovative Sale or Return scheme, which allows buyers to rent the property for an initial period with a view to purchase later in the year.

McDermott Homes currently has six developments in the North West in Bacup, Keighley, Earby, Bolton, Blackburn and Rossendale.

The developer is also currently offering a number of other excellent deals for buyers, including 105% part exchange on selected properties, where buyers can receive up to 5% more than the market value of their home, as well as substantial discounts and free carpets on selected plots. More information is available from the McDermott sales office by visiting mcdermotthomes.co.uk.