First time buyer mortgages can be both intimidating and confusing, as the homeseeker will most likely be unfamiliar with the whole home buying process.
Here are the top tips you need to know, for finding the best first time buyer mortgage deals and moving on to obtain your first time buyer mortgage.
Take independent financial advice
By taking independent mortgage advice, you will, on average, end up paying £962 per year less in mortgage repayments, according to research by the Association of Independent Mortgage Intermediaries (AMI). An independent mortgage adviser can compare all of the first time buyer mortgages on the market, to find you the best UK mortgage deals. An adviser employed by or affiliated to a single lender, on the other hand, can offer only a handful of first time buyer mortgage deals.
Maximise your first time buyer mortgage deposit
Obvious, perhaps. But what does ‘maximise’ mean, at the moment? In a nutshell, and generally speaking, only a deposit of 20 – 25% of your first time buyer mortgage will get you the attention of the larger lenders. However, much better first time buyer mortgage deals are available, and an independent adviser can locate them for you.
Establish your borrowing credentials
You can prove you are a responsible and reliable borrower by producing documentation proving you have had and repaid other borrowings, such as a credit card. Particularly important in relation to first time buyer mortgage deals, as you may be an ‘unknown quantity’ to lenders.
Clarify any blots on your copybook
If you have missed any loan repayments of any kind in the past, ensure that the explanation for the arrears is clear to your potential first time mortgage lender, especially if there were good reasons for your default. Otherwise the lender may assume that you were simply careless, or unwilling to pay.
Have your bank on your side, when seeking a first time buyer mortgage
Your bank will be happy to provide a credit reference that will go a long way towards showing that you are a responsible customer.
Be aware of hidden costs in first time buyer mortgages
First time buyers are often unaware of the extra costs that apply to taking a first time buyer mortgage. These may include a survey costing from £50 to £1,000, depending on the level of detail; solicitors fees of up to £1,000 for a basic service (and more if there are complications); a local, environmental and water search costing £200-300; and stamp duty applicable at 1% on all homes over £250,000, although this threshold is currently (spring 2010) under review.
Register to vote
Being registered to vote establishes your current address. Lenders like to see this.
Find out about first time buyer mortgages!
On this website you can read all about first time buyer mortgages, make a mortgage enquiry. To speak to us, or arrange quality independent mortgage advice call freephone 0800 678 5929 now.
