Top Advice for First-Time Buyers

Buying your first home is an exciting time, but it can also be stressful. This is inevitable for such a large investment, but if you plan your moves carefully you can help the process to go smoothly. Here are some of the most important factors to consider when you decide to get on the housing ladder.

Start Saving for Your Deposit and More

If you want to buy a house, you’ll need a deposit. As soon as you know you want to get on the property market, or even before, you’ll need to start saving.

Even with a 95% loan-to-value (LTV) mortgage, you’ll still need that 5%. But the larger the deposit you can provide, the better. It will make your monthly repayments lower because the interest rates will be lower.

You might also have to pay legal fees, stamp duty and other costs, and these all add up, so work out exactly how much you can be expected to pay and start saving. You might want to save in a higher-interest account to make your savings work harder. You could also set up a direct debit to your savings account so you continue to save without thinking about it.

If you’re finding it hard, create a budget and look at areas where you can cut down on your expenses, like switching to a cheaper gas provider.

Know How Much You Can Spend

Once you start saving up for your deposit, come up with a figure for what you can afford to spend. You should come up with one amount for what you would like to spend, and one amount that is an absolute maximum you can afford to spend on your new home. That way, when you are looking at properties, you know when one is out of your budget. It’s easy to get tempted by that perfect property, but you need to stick to what you can afford.

Compare Mortgages

There are plenty of first-time buyer mortgages available so make sure you compare them and work out what you can afford. Work out the deposit you can put forward and how much you can afford to pay back a month, and then look around and compare your options to find the most suitable product.

Get on the Electoral Roll

Make sure you register to vote before you start applying for a mortgage. Lenders will check that you are on the electoral roll in order to reduce the risk of fraud, so you’ll want to be on it.

Consider Alternative Ways to Buy

If you think it will be a struggle to buy your first home, consider your other options. For example, you could look at a shared equity scheme where you buy a percentage of a property and a housing association buys the rest.

You could also consider the Help to Buy scheme from the government that helps you get a 75% LTV mortgage with just a 5% deposit. Then there is also the Help To Buy ISA where the government tops up your savings.

Make the Buying Process Go Smoothly

These are some of the most important factors to keep in mind when it comes to buying your first home. While buying a home can be a rollercoaster of emotions, follow these tips and they should help the process to go more smoothly.

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