Buying a house next year...how can I prepare?

[BabyRoosMum]

Hi, I am currently renting with my dp and we have an 8wk old ds. By next christmas, we want to have bought a house. I will be on mat leave until June and so am looking for peoples top tips as to what I can do before June (when we will actually be able to afford to buy iykwim)
We have already-
.cleared most debts (mine all gone and dps minimal)
.have 0% credit card which we buy on and pay off to maintain credit score
.acquired deposit from FIL

Our savings are currently around £2,000 although we may have to dip in to this when my pay drops down

Any replies appreciated! :)

If you're not already, then look after you papers and bills etc so you know exactly where to find 3 months of payslips, bills etc.

You have plenty of time to start to declutter and get rid of all the stuff you don't want to take with you - you can get a little bit of money in the process if you sell stuff on ebay or do NCT nearly new sales and get rid of all the masses of baby stuff that accumulates.

Start counting every penny now so you're a pro when your maternity pay dwindles away. I looked at everything that was going out of my account and made cuts wherever I could - reduced my mobile contract to about £10 a month, got my contact lenses online instead of through the optician etc.

Can't think of anything that's very useful - it all really depends on tight lending is at the time and how much deposit you'll have.

You're mad!

You have 2k of savings and you want to buy a house!

Complete and utter madness.

It does sound unrealistic. Minimum deposit you will need is 10% of purchase price but to get a decent interest rate you will need 25% (your 2k will be used on solicitor, survey and mortgage application fees). How much are the houses in your area?

My advice is to start studying rightmove NOW, do a weekly search so you can get a feel for what is available, prices, prices dropping, length on market.

beautyspot - I think the OP is borrowing money from her FIL as the deposit, and the 2k is their own savings.

So, alongside researching thoroughly the best mortgage deal, think about how you are going to repay the deposit. Has your FIL set clear terms and time scale?

Those are the key things. I can't emphasise enough the importance of shopping around for a mortgage.

And try to save too for the unexpected

Sorry just seen that your deposit is gifted, lucky you! Generally the mortgage company will still want to see that you have the ability to save each month, so even if you are getting 50k gifted still save a percentage of your income each month.

I think you need more savings as well. Houses are expensive to run, you need money for contingencies as compared to renting where you just phoned the landlord to get them sorted. You'll need money for home insurance, which can be expensive, depending on the house. Why the rush to own? Renting can be advantageous and less stressful.

Thanks for your responses...yes, my dp's dad has offered to pay our deposit.we are very lucky that he is able to do this-we'd never get there without it! He doesn't want us to pay it back however dp and I have discussed paying him something back should we sell and move on,making a profit. We definitely need to get these details ironed out before hand, so thanks, I'll add terms etc to my list!
For a bit of background, I've been renting for 6yrs so not really a "rush" in our eyes. I'm used to paying all manner of bills, budgetting etc . I have everything to furnish a house bar a fridge, which is one of the reasons I have no savings! I know that there are advantages to renting but we want to have a bit of security after being bitten in the past when we rented our previous house.
Glad to have an excuse to search rightmove, something I do regularly anyway but good idea about monitoring cost etc. (We could probably get a 3bed semi for less than £140k round here)

thanks again :)