First Time Buyer Mortgages
The modern dream of owning your own property may not be as far away as you think.
If you feel financially secure and have your heart set on purchasing your first home, then it will help if you understand as much as possible about the first time buyer mortgages available to you.
Where To Start
Firstly review your credit file through one of the credit reporting agencies such as Experian or Equifax. Start to address any problems and build up your credit score. First time buyers often only have a small deposit which means they need to borrow a larger percentage of the properties purchase price. The greater the percentage that needs to be borrowed, the stricter a lender will be with the application.
Identify the kind of property you are interested in and the market value. On our website, we have a simple mortgage calculator tool that helps predict what your monthly repayments may be. To use the calculator tool, you’ll need to plan how long you’d want the mortgage for and what deposit you can pay upfront. You can use the calculator tool to experiment with different options.
Before you even start viewing properties, it’s important to get a detailed grasp of your personal finances. Mortgage lenders focus on how much they can lend you based on affordability. Simply put, lenders want to see how much spare income you have once all your bills and expenses are paid each month. If you already pay rent and household bills this is a good starting point. You need to know about all your finances in detail. What are your outgoings and income? What debts do you already have?
What Deposits Are Required
The minimum deposit for a first time buyer mortgages is 5% of the amount you need to borrow. The larger the deposit, the better the interest rate on your mortgage. As a guide, you have a better choice of mortgages if you have saved 20% of the property value for a deposit. Don’t worry if you haven’t been able to reach this value. The team at Elementary can still help you find an affordable mortgage deal.
First Time Buyer Mortgages – Fees and Expenses
Fees vary depending on the lender and the solicitor that you use but can include;
- Arrangement and booking Fees for the mortgage product payable to the lender
- Valuation Fee
- Solicitors Fee
- Stamp Duty
- Broker Fee
Don’t worry; our mortgage advisers will make you aware of all the costs involved before you start any application process.
First Time Buyers can often take advantage of offers from lenders, for example, free valuations and even cashback deals. If the property you are purchasing is less than £300,000, there will be no stamp duty to pay.
Who Can Apply for First Time Buyer Mortgages
The classification of a first time buyer can vary from lender to lender. Some lenders will only accept people who have never owned a property; others will allow buyers who have not owned a property in the last 12 months.
To apply for a mortgage the lender or your adviser will need to see certain documentation to prove your identity and income. As a guide the minimum requirements would be;
Proof of Income
Employed – Latest three months Wage Slips and Latest P60s.
Self Employed – Accounts or SA302s and tax year overviews going back between one and three years.
Proof of other income such as benefits or pension.
Three months of bank statements showing wages coming in and bills going out.
Details of the account showing the deposit and how it has been built up.
Depending on your circumstances, there is likely be other documents needed as well as those listed above.
Find Out More
At Elementary Mortgage Solutions, we have a vast amount of experience in helping first time buyers secure the loan that is right for them. We can support you through the whole process from checking you know all about the costs involved to making sure you have all the right paperwork. As we aren’t tied to a specific lender, we can search thousands of available mortgages to ensure you get the best deal available.
To speak to a member of our team, please call us on 0115 7845780 or send your enquiry through our contact form.
For information on mortgages for first time buyers check out our blog post ‘5 Important Tips for First Time Buyers‘.
Our Customers Say...
Ivan Whitelocks satisfied all my needs. Guiding me through the process with ease. He was easy to reach and quick to reply to any enquires. Going above and beyond at the end of our purchase when I hit a snag with my conveyances. Fully recommend him and look forward to speaking to him again if I ever need mortgage advice again.
What a superb service. From a great professional work ethic, to monthly mortgage savings Ivan had it all. Was always available if anything needed to be discussed. Made sure we got the best possible deal available and made us look at our finances in a different way, leading to fantastic reductions in a our monthly out goings. Best mortgage service I've had. Would definitely recommend.
Elementary mortgage solutions arranged a remortgage on a property we let out. The process was extremely simple and we got an excellent deal that lowered our monthly payments considerably. I'd highly recommend Elementary and will be using them again in the future.
Ivan was brilliant. He was quick and communicated well and was great at giving us advice on our way to picking the best mortgage for our situation. Will definitely use him again in the future.