First Time Buyers
If you're thinking about buying your first home you're probably
finding the whole process of choosing the right mortgage and
actually buying your ideal home rather daunting? So what do you
need to know to get on to the first rung of the property
ladder?
The first step is to contact us and we will advise you on the
mortgage options available to you.
In the meantime we've outlined below some background information
on mortgages for first time buyers that we hope you'll find
useful.
How much can you borrow?
The amount of mortgage you can get depends on your income.
Income multiples do vary. As a rough guide, a typical multiple
is four times your income. This figure could be higher or lower
depending upon your individual circumstances and different lenders'
criteria. Some lenders do not use income multiples at all and will
lend based on affordability.
Once you add to this the amount that you can afford to pay as a
deposit, you have the amount you can pay for your first
property.
Some lenders offer very good deals for first time buyers, so it
always worth asking us to research the market on your behalf.
Any other costs?
It is also worth remembering the additional costs, on top of
your deposit and mortgage that you will be expected to pay.
For example, you will have to pay stamp duty, which is (from Jan
1st 2010) 1% of the purchase price for properties between £125,001
and £250,000, then 3% up to £500,000 and 4% on properties over
£500,000. For properties up to £125,000 you do not have to pay
stamp duty.
Plus you will have to pay for the survey and the valuation of
the property, and solicitor's fees.
You may also have to pay an arrangement fee for the mortgage and
in some cases a Higher Lending Charge - which is insurance for the
lender for you defaulting on your payments when your property is
worth less than the loan.