First Time Buyer
Buying your first home is a big decision and it can be daunting. That’s why we have a first time buyer mortgage guide to help you understand the process better. We want you to make a smart choice, so please read the whole guide carefully before deciding. If you need more help or have any questions, please contact us. We’re here to help!
Buying your first home is exciting and daunting. It’s a big life step, but it can also be hard to grasp all the details of a first-time buyer mortgage. That’s why we have a first-time buyer mortgage guide for you. We explain the process in simple terms, answer common questions, and give you all the information you need to make a confident decision. Read on if you’re ready to start your homeownership journey. We’ll guide you through every step of the first-time buyer mortgage process. If you ever need more help along the way, contact us.
Who is a First Time Buyer?
If you’ve never bought a property before, then you are a first-time buyer. That’s right – this covers single people and couples who have never owned a home.
First-time buyers can benefit from mortgage terms that others don’t qualify for.
Schemes like Shared Ownership and other lender-based schemes can also help buyers get on the property ladder.
To start your homeownership journey, it’s important to research all possible options before deciding
First Time Buyer Deposit
Usually, you need a deposit of at least 5% of the property price you want to buy. For example, if you want to buy a home for £150,000, you need a deposit of at least £7,500 (5%).
The bigger the deposit, e.g., more than 5%, the more mortgage lenders you can access who may offer a lower interest rate.
Mortgage for Adverse Credit for a First Time Buyer
It can be harder for people buying their first home who have had problems with their credit. But they can still get a mortgage. However, they might need to pay a higher amount upfront or a higher interest rate. Credit problems include not paying on time for a credit card, when you owe money or when you get a court order to pay.
If the problem happened a long time ago, it might not matter as much. For example, if it was over 6 years ago. If it was over 3 years ago, there might be good deals available. But if it was more recent, it will be more difficult to get a mortgage and you might need to have more money upfront or pay higher interest.
Get an interest-only mortgage if you’re a first-time home buyer.
An interest-only mortgage allows buyers to pay only the interest each month, keeping payments lower. Buyers need a plan to pay off the principal at the end of the term.
This option is often only available to high-income borrowers. Another option is to choose the longest mortgage term available, up to 40 years, lowering monthly payments but increasing overall interest paid.
First Time Buyer Mortgage Advisor
A first time buyer mortgage advisor can provide guidance throughout the home-buying process by helping to understand options, comparing lenders and products, improving credit scores, saving for deposits, submitting applications, and understanding legal documents.
With their assistance, first time buyers can gain knowledge and confidence in the home buying process and increase their chances of finding a suitable mortgage.
Mortgage brokers are helpful if you have a small deposit, are self-employed, have bad credit, can’t afford a mortgage, want the best deal, or have a complex property.
First Time Buyer Mortgage Advice
If you’re buying a house for the first time, follow these tips:
– Check how good your credit score is.
– Find out who can give you a mortgage and choose the one that’s best for you.
– Decide on your budget – think about how much you can afford to spend on your mortgage each month.
– Get pre-approved for a mortgage to show you’re serious about buying.
– Get help from a mortgage advisor to make sure you’re making the right choices.
By doing these things, you’ll make it easier to choose the right mortgage for you.
Ensure you have enough money to pay your monthly expenses.
Nowadays there are many mortgage calculators available to help you figure out how much you can borrow. Different lenders have their own criteria for approving applications. Some may overlook a missed utility bill payment from a couple of years ago while others may not.
Even if they do take your application under consideration with a County Court Judgment, they may still need further information regarding the amount, reason, and basic understanding of the situation. Using the services of a qualified independent mortgage broker can save you time and anxiety.
A general rule for employed clients with clean credit records and a history of 12 months’ work is to expect a loan 4.5 times their salary. Nevertheless, it’s essential to ensure that the amount is affordable each month, considering other everyday expenses like food, gas, and electricity. It’s best to consider a budget before opening the property search.
Final Thought
If you’re a first-time buyer and want to purchase a home, you should start by researching the market and lenders. This will help you understand the different options you have for getting a mortgage.
You should also work out how much you can afford and be aware of any fees that come with buying a home.
Before you start looking for a home, you should get pre-approved for a mortgage so that you can be sure you have the money you need to buy a home. With these steps taken, you’ll be ready to find a home you love and start your journey to becoming a homeowner.
FAQ (Frequently Asked Questions)
Who can get a mortgage for the first time?
If you’ve never owned property before, you can usually get a first-time buyer mortgage. But, some lenders may still consider you a first-time buyer if it has been many years since you owned a property.
How much money can I borrow to buy my first home?
To know if you can afford a mortgage, you need to consider your income, credit score, and other financial factors. Start by figuring out how much you can afford to pay every month for a mortgage, after you deduct your expenses from your income. To get more specific information about the type of loan you are eligible for and how much money you can borrow, talk to a mortgage advisor.
How can I get a mortgage as a first-time buyer?
To get a mortgage as a first time buyer, you should do some research on different options and lenders. Get pre-approved for a mortgage before you start looking for properties. It’s a good idea to work with a mortgage advisor who can help you find the best terms for your needs.
Can a first time buyer get an interest only mortgage?
Yes, a first-time buyer can get an interest-only mortgage. However, they will need to meet certain criteria to qualify for one. A longer-term repayment mortgage may be more suitable.
What kind of home loans can people get if they’re buying a house for the first time?
If you’re buying a home for the first time, you can choose from different types of mortgages like ones with a fixed rate, variable rate, tracker, or offset. Special schemes are available to help you get on the property ladder. Keep in mind that each option has its benefits and drawbacks, so it’s essential to research and learn about different types of mortgages before making a decision.