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First Time Home Buyer’s Guide

Buying a home for the very first time can be a hugely daunting task, especially given how many elements you need to get your head around. In this blog we’ll give you a quick-reference guide of the most important points to consider to set you on your way. Read on to learn more about how you can become a successful first time buyer and secure the home of your dreams.

Work out the costs of buying a property

Before you start to look at properties, take some time to think about the various costs involved, including up front costs, mortgage costs and maintenance costs required to run your home. A deposit is an essential part of mortgages these days — put simply, you’re very unlikely to secure a mortgage without one, as it helps to show that you’re financially disciplined. You have various other fees and expenses to consider, such as stamp duty and legal fees, so plan carefully and break down the key costs involved in buying a property so you can create a realistic budget and work out what you can afford.

How to save for a deposit

It can be tough to pull together a large deposit, but being able to put a sizeable cash sum down on your chosen property has advantages, such as securing a mortgage deal with a lower interest rate. Think about the various savings tools available to you, such as a Help to Buy Isa, via which you can save up to £200 per month. The government will even award you a 25% bonus when you come to complete your property purchase, but Help to Buy Isas are only open to new savers until 30 November 2019.

Seek help from you family

There are now mortgage products available that are geared towards supporting first time buyers whose parents or grandparents want to help their children out with their property purchase. A guarantor mortgage may increase your chances of securing a favourable deal as it provides a secure option for your lender, where a family member agrees they will make the repayments if you can’t. There are a few other options worth looking into, such as family offset mortgages which use parents’ savings to help reduce their children’s mortgage expenses.

Consider help to Buy and Shared Ownership schemes

A Help to Buy scheme from the government can be hugely beneficial for those struggling to afford a home. The government offers you an interest-free loan to boost your deposit and land you a competitive mortgage deal on a new-build property. Shared ownership schemes enable you to borrow enough to buy a proportion of the property, say 50%, and you pay rent on the remaining proportion. Typically, all you need is a 5% deposit!

Securing a mortgage

At the beginning of your mortgage application process, consider factors such as the length of the mortgage and the loan-to-value ratio (LTV), which is the percentage of the property value you’re loaned as a mortgage. A professional mortgage adviser can help to assess your ability to afford the monthly mortgage payments and hopefully offer you advice on the best course of action for your circumstances. Boosting your credit score will give you an advantage but it can take months. Laying the foundations by — for example — showing that you can manage credit card repayments, will make you a much more appealing prospect to lenders. Your mortgage adviser will be able to help you obtain a ‘Decision in Principle’ from a suitable lender, which will give you the freedom and confidence to start looking for a property.

Finding the right home

Now that you know you can secure a mortgage, it’s time to start looking for your dream home. Think carefully about the location and whether it meets your requirements — are there any particular amenities that you would prefer to have nearby, such as a leisure centre or train station? Build a checklist of your must-have and nice-to-have features, such as the number of bedrooms, so you can prioritise what’s important to you. This may take time but the more properties you look at, the easier it will become to edit your list. Also consider a property’s resale potential, so that if your circumstances change and you need to move, you won’t be stuck without any interested buyers. Buying a property next to a noisy factory, for example, could severely hamper you resale opportunities!

Hire a solicitor or conveyancer

Once you have found your dream home and your offer has been accepted you will need to instruct a solicitor or conveyancer to handle the legal work to transfer ownership of the property to you. The solicitor or conveyancer will also conduct essential searches for your property to ensure there are not any major problems with it. Some estate agents will recommend to use their own conveyancer but the choice is usually yours, albeit some mortgage companies may require you to use a solicitor that is on their panel.

Consider a survey

Your mortgage lender will require survey valuation conducted by a surveyor. This will be a relatively basic survey ensuring that the property you have chosen is good enough for them to lend you the money against – however you have the opportunity to upgrade to a more in-depth survey that will flag up minor or major issues you will or may face when you move in.

You’ve secured the keys, now it’s time to move in!

So, you’ve had your offer accepted and you’ve secured the keys to your first home! Now you need to work out how to move all your possessions in and think about which items may need placing into storage. As a leading removals and storage company, we understand that moving in can be a stressful time. Allow us to take stress out of your moving in day by tailoring our service to your specific requirements.

For a free removals or storage quote, simply fill in the enquiry form here and one of our team will be in touch with you. If you would rather talk to somebody about the support or service you require, please call us on 01275 872251.