The answer is that, ultimately, you will need to get a mortgage, and to do that you will need often a 10% deposit, but possibly 5%. So how much of a deposit do you think you will be able to save, and what sort of mortgage level would you be able to pay when you have got that deposit saved? These are the sorts of questions that you will need to consider when it comes to working out what you can afford to buy and what you can't.
Let's say that you have your heart set on a property that costs £250,000. This means that if you looking at a 5% mortgage product then you will need to have saved a total of £12,500 as a deposit, whilst for a 10% mortgage you will need double that, or £25,000.
You may wonder why you would ever go for the second when you can save half as much as still potentially get a mortgage. Well the answer is that it can be a lot tougher to get a mortgage where you have a lower deposit as there is greater risk for the bank and therefore they are going to check that your credit history is exemplary and everything else they check is in order to compensate for that higher risk that they take on board.
Remember too that the bigger the deposit, the smaller the mortgage you will need, and therefore ultimately the less you will have to pay back and so the monthly amounts get smaller. Therefore whilst many obsess with saving the exact amount for a deposit, if you do meet a 10% level of the sort of home you want, don't stop there unless you find your dream home straight away: continue saving as much as yuo can as then you may be able to pay even more off upfront and if not at least you can build up a decent sum to cover the first few month's mortgage payments on that first home of yours!
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