First Time Buyers Guide
How much can I
borrow?
The amount lenders will
loan you will vary greatly and gone are the
days where the lender will lend you say 3.5
times your annual salary.
Most work with affordability
calculators, which consider your outgoings,
the size of your family and of course your
income.
You can still use 3.5 times your
salary of 3 times joint salary as a guide.
Our mortgage advisers will be able to
tell you accurately how much you can borrow.
The size of your
deposit is also important, the bigger the
deposit the better the rate offered and even
the higher the loan.
You will more than likely need a
deposit of at least 10%.
Home Buy schemes help first time
buyers who have no deposit.
Can I afford
the mortgage?
You need to sit
down and draw up a detailed monthly budget
of all your income and expenditure.
This will show you what you have left
to pay for your mortgage repayments.
The last thing you to take on more
than you can afford.
Also consider the
effects of any future mortgage rate
increases.
You will also need to
consider the additional cost of insurance
such as Home insurance, life cover and
redundancy cover.
Valuable protection, but at an
additional cost.
Choosing the
right mortgage scheme
There are
literally thousands of mortgages out there
in the market to choose from, but
fortunately there are only a few really
crucial things you really need to know
about.
- Fixed rate, where
the repayments stay the same for a
pre-determined period whether interest
rates go up or down.
- Variable rate,
where the repayments can go both up and
down.
See our Guide to
mortgages for full details on all of the
schemes available and the advantages,
disadvantages of these schemes.
Its important to seek
professional advice when choosing the right
mortgage, that’s where Direct Mortgage
Centre can help.
Get your
mortgage agreed
Once you've
found the right mortgage, you will need to
get an Agreement in Principle from the
lender. We can advise you about this. It
doesn't commit you to taking out a mortgage
with this particular lender, nor does it
commit them to lending you the money. But it
does let you start house hunting knowing
that mortgage funds have been agreed, this
will also put you in a better position when
negotiating the price.
Finding your
perfect home.
See our
House
Hunting guide for advice on choosing the
right property.
Found your
dream home
Its time to make an offer, be strong and negotiate the best possible
price, see our guide to moving.
You will need to appoint a solicitor
and arrange your mortgage.
As part of the mortgage
process your lender will want to carry out a
valuation, you will need to pay for this,
see our guide to cost of moving.
Mortgage valuation. This is simply a report
from a professional property surveyor that
enables a lender to decide whether the
property is worth enough, and is in good
enough condition, to provide security for
the loan. A valuation is the cheapest form
of survey but it doesn't tell you, the
purchaser, much about the condition of the
property.
A full survey, or
Homebuyers Report, describes the property in
detail and reports on any visible defects.
If anything comes to light now that you
didn't know before, and that makes you think
twice about buying, you have the right to
withdraw your offer. A full survey costs
more than a valuation.
Finally
there's a structural survey: as the name
suggests, this gives even more detail on the
condition of the property. It's not always
needed, but can be advisable if the property
is very old, or in visibly poor condition,
for example. And yes, it costs even more.
Arranging your
Mortgage
If you've already got
an Agreement in Principle, this stage should
be a bit easier. Your adviser will be able
to advise on the latest rates as these may
have changed since you first spoke.
You will need to provide the relevant
document the lender will need and also pay
for the valuation.
Protecting your
new home
Borrowing all that
money from your lender is a big financial
commitment, and you'll want to know that you
can still make the payments if you lose your
job or fall ill. This is where protection
comes in.
Most people find their
first few years of home ownership to be a
financial stretch, and it can seem like
insurance is just another cost at the worst
possible time. But knowing that you're
protected against whatever life may throw at
you brings peace of mind, and that's worth a
lot.
There are a range of protection
policies available such as Life Cover,
Critical Illness Cover, Income Protection
and Redundancy Cover.
More information can be found in our
Guide to Mortgages or speak to an Adviser
today.
Moving Day
We have a complete guide to your
moving day
which you is FREE to download and use to
help you plan for the big day.
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