What help is available for First Time Buyer?

There are a range of options out there for First Time Buyers to help edge them onto the property ladder. You can use a guarantor alongside your mortgage application to give lenders a sense of security.

You may be able to use a guarantor to assist you with your mortgage application, however, it is important to understand that each individual bank will have its own criteria and this would need to be discussed with your financial adviser if this is applicable to your circumstances. Your guarantor will need to prove they can afford the monthly mortgage payments in addition to their own expenditure and lenders will usually assess the application against the age of your guarantor.

First Time Buyers also have access to the Help to Buy scheme run by the Government, which involves gathering a deposit which is 5% of the property’s purchase price that you intend on mortgaging. Once you have this deposit, the Government will offer you 20% of the property’s value to put towards your deposit in the form of an equity loan. This option is subject to an affordability assessment and is only available on new build properties.

You can also go into your mortgage with another person meaning you will have more of a combined income. This is known as shared equity. There are also shared ownership mortgages where a developer or housing association will let you buy a share of the property and pay rent on the percentage you do not own.

It is important to know your options inside out and read into every mortgage deal in great detail. It is worth seeking the help of an expert mortgage adviser to ensure that you are picking the right option for you.

What fees are involved?

There are fees involved when it comes to purchasing your first property and you should be prepared to pay them.

Arrangement Fee

This is a fee that a lender will charge to arrange your mortgage. The amount this fee will be will greatly depend upon the lender and the value of your mortgage deal. You can be charged a percentage of your mortgage’s value or a fixed price.

Legal Fees

You will need to appoint a solicitor or conveyancer to sort the legal documentation involved with setting up your mortgage.

Valuation Fees

The lender will complete a valuation on the property to ensure the value of the property is in line with the purchase price. The valuation fee varies from lender to lender.

Stamp Duty

The amount will depend upon the price of the property. It is so important to keep up to date with Stamp Duty, at the moment there is a break on the first £500,000 of a home due to COVID-19 that will come to an end in March 2021.

How can a Mortgage Broker help?

A Choice Mortgage Broker can help advise you on the right mortgage for your personal needs and situation. As a First Time Buyer it can be daunting stepping into the mortgage market it can be a competitive and complex place. There is no point in getting lost and frustrated whilst searching for a mortgage, if you seek expert advice from the start you will be speeding the process up and giving yourself more of a chance of obtaining property you want to buy.

A Mortgage Broker can scour the market and find the right option for you. There are so many different types of mortgages – fixed-rates, variable rates, interest rates and it can take some time to go through them all. The one to one advice that a broker can offer will be unmatched due to it being catered specifically to you.

It doesn’t matter what stage you are at when applying for a mortgage even if you haven’t even started it yet; mortgage advisers are there to make sure you are getting the most out of your money and the best deal for you in the current mortgage market.