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FAQ’s for First Time Buyers

So you have decided that living at home with your parents/guardians just isn’t cutting it anymore and you want your own space, that great! You’ve decided it’s time to get on the property ladder, but how?

This first time buyers FAQ’s guide might be just what you need…

Buying a house is by no mean stress free, but getting ahead of the game by researching the steps you are going to have to take and preparing yourself for the journey ahead is always a good idea.

It is worthwhile trying to answer as many questions as you can going into the process as it can get overwhelming at times. Hopefully this guide will answer a few of you burning questions!

Deposit 

There is no definitive answer. This is totally dependent on the house you are looking to buy. In any situation the higher the deposit the better, however it is possible to have a 5% deposit with the Governments Help to Buy Scheme. Although, 5% in some cases can seem like a small amount, it is 5% of the property price meaning the more expensive your home is, the higher your deposit needs to be.

The average house price for first time buyers is around £200,000 so if you are looking for a figure to work towards, £10,000 is a good place to start.

What do I need?

Firstly you need to assess your financial situation. Are you able to buy the property you want? Is it realistic? What is the long term plan?

When you have all of this figured out you then need to find a mortgage adviser who can guide you through the different stages of purchasing your first home.

It’s a good idea to go with a mortgage adviser that you can do some research on. Maybe someone you know has used a trusted adviser or look for someone that has a good reputation online. They might even have online reviews from other homeowners – do your research!

Your mortgage adviser will talk through all of your documentation and finances with you to assess exactly how much you can borrow so you know what you are working with.

Once you get a Mortgage in Principle, sellers will know you are serious and have the funds to buy the house you are looking at.

Then the fun begins – house hunting!

Documents

Among other documentation you might need to provide – here are just some of the most common:

  • Driving license/Passport
  • Bank statements for the last three months – credit/debit/savings (three years if self-employed)
  • Three months of pay slips (or three years of accounts if you are self-employed)
  • Utility bills

Applying

There are various mortgages available for homeowners, all with pros and cons. It’s a good idea to speak to your mortgage adviser about the difference in mortgages to ensure the one you choose fits your financial needs and requirements.

The most common are fixed rate mortgages or standard variable rate mortgages. The difference between the two is that you either pay a fixed monthly payment for a fixed amount of time or you pay a variable amount set by your lender, which can change as often as they want it to, over an agreed amount of time.

There are other mortgage deals that may suit different kinds of buyers, for example, interest only mortgages or perhaps specialist mortgages. It’s always good to speak through all your options with your mortgage adviser.

Application

  • Speak to a mortgage adviser – get an idea of what you can borrow
  • Get your mortgage in principle
  • Find the property you want to buy
  • Put an offer in
  • Your offer is accepted
  • Your mortgage application is accepted by your lender
  • Approach your chosen solicitor who will take care of all the legal stuff
  • Have a property valuation and survey to assess the structural status of the house
  • Exchanging contracts
  • Pick up the keys
  • Move in – enjoy!

Timeline

Again, there is no set time frame on when you can move in or how long the buying process takes. Although your solicitor will negotiate a time frame for handing over the keys, nothing is set in stone until the contracts are exchanged.

 Depending on sellers circumstances (whether they are still looking to buy somewhere) it might just be a waiting game.

In cases where you are buying a new build property, you might be waiting on the property to be finished and signed off, this could be a matter of weeks, or months, it all varies.

Another thing that can delay or even prevent you from moving in completely is getting ‘Gazumped’. This is when another buyer comes in and offers a higher price for the property you have had your eye on.

Unfortunately there is nothing you can do other than compete with the new offer, if you can. In some cases you can ask the seller to remove the house from the market to reduce the risk of others being interested, but again, there is always a risk before exchanging contracts.

YOUR HOME MAY BE REPOSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE