Should everyone have a mortgage?

Jumping on the property ladder is a dream for many would-be first-time mortgage buyers who want a slice of bricks and mortar success. Fresh statistics from the Council of Mortgage Lenders have found that the amount of mortgages have increased by 12%. This shows the appetite for first-time mortgages in the UK as lenders start to come back to the industry after the belt-tightening of the recession where consumers looked for cash from sources like payday loan providers. Let’s look at the advantages and disadvantages of first-time buyers in the mortgage market:

Pros

  • Mortgages make everyone investors: Property is an investment in the same way that art is. It’s really important for people to have the chance to own a slice of property to protect them in the future and to get on the property ladder. The positive effects of mortgages are that it allows everyone the chance to be investors in their own financial portfolio and to take control of their ability to shelter themselves.
  • It’s better to do it now: Time plays a huge factor in the success of first-time buyers and it’s really important to get in on the act before prices for homes rise and the effect of inflation affects your ability to get on the ladder. Many people subscribe to this way of thinking and this is why many first-time buyers look for additional help from family to get a mortgage.

Cons

  • It can be expensive: Being a first-time buyer is not necessarily cheap regardless of how small the deposit can seem especially coupled with savings and money from inheritances. You need to consider if you can afford having a mortgage. If you lose your job or you become sick, you should look at whether you can pay your mortgage to avoid getting into debt.
  • It eats into savings: Paying off a mortgage for a set amount of years means that it can be more difficult for you to save especially if you have dependants that you need to pay for. Always have emergency savings in place before you jump onto the property ladder in case times get difficult, you then know you are not eating into your personal finances.

A mortgage is seen as a right that everyone is entitled to. In the UK we love property, and mortgages come as the glossy packaging to dream properties for first-time buyers. Ensure that you can financially afford the mortgage and start your property journey today with thorough planning.

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