First Time Buyers
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One of the biggest concerns for first time buyers is going to be finding the right mortgage for them – after all, this will be the biggest financial decision of your life, and you’ll probably have no experience of it. You know when you find a home you like, you know how to save money (or you’re figuring it out) but when it comes to interest rates, percentages and the wide variety of choices available, mortgages can be terrifying.
Finding a Mortgage
You can apply for mortgages directly from a bank or building society.
But you might also want to think about using a regulated mortgage adviser. Advisers know a lot about the mortgage market and can help you find the mortgage that best suits your needs.
This is particularly useful if:
- you only have a small deposit
- are self-employed
- there are other circumstances such as the type of property, for example you need a mortgage for a shared ownership scheme.
First-time buyer’s mortgage deposit
To get a mortgage as a first-time buyer, you will need a deposit. 100% mortgages are practically extinct unless you’re using a guarantor or a concessionary purchase. Some lenders will take a 5% deposit, but this is likely to fall under a government mortgage scheme.
Lenders will generally offer preferential rates to those with higher deposits. The very best rates appear with 25% deposits or more, which of course means your mortgage payments will be a lot lower than if you had a 5% deposit.
It may be worth saving as much as you can for a deposit, as it has huge advantages.
Mortgage rates for first-time buyers
Mortgages are generally either one of two kinds. A fixed-rate mortgage or a tracker (variable) rate mortgage. Once your initial term is over, mortgages usually revert to a variable rate.
