step on the ladder – Gaining a foothold on the first vital rung of the house-ownership ladder is not getting any easier for new buyers, and one of the biggest challenges is finding the right mortgage. The best advice that anyone can give you is to be prepared to spend the time to shop around. Start by researching lenders online and comparing deals, but it’s then worth your while going to talk to them in person.
step on the ladder – Most banks and building societies will have advisers based in their local branch who can take you through the confusing array of terms and types of mortgage, and advise on which might be most suitable for you. Many lenders are keen to attract first-time buyers; for instance Santander offer mortgages to first time buyers of up to 90% of the value of a property to help them to get on the property ladder.
Their homebuyer solution also provides a free standard valuation, and £250 cashback on the completion of your sale. All offers are subject to status.
Key tips: Don’t be embarrassed to ask what the different terms mean, whether you are talking to a mortgage lender or an independent broker.
Buying a house is probably the greatest commitment that you will make in your lifetime – outside marriage – so it’s vital that you have all the information that you need to make the right decision Be realistic.
Work out what you can afford in monthly repayments, and then take out the red pencil! Many of us err on the side of optimism when it comes to calculating the size of mortgage we can take on, especially if we have seen a house that we are desperate to buy.
Use one of the on-line calculators provided by lenders Research fixed interest and variable rate mortgages on offer to see what’s behind the fine print. You may find that there are hefty penalty clauses if you wish to leave your lender after an initial low interest rate term has run its course. The same applies to redemption penalties : it’s almost certain that your lender will penalise you if you wish to get out of your agreed deal before the term is up. The key issue is how much? Think ahead: find out what is on offer for your next purchase.
Getting your first house might seem like enough of a challenge at the moment, but it’s worth asking lenders if they will be offering you a full range of deals when you get to the end of your current arrangement. Many attract new customers by offering “sweetheart deals” which are no longer on the table when you are discussing your next house purchase. Loyalty pays – in the case of first-time buyers, your existing bank or building society will often have favourable deals that they will only be offering to their existing customers.
Posted by My First Home Blog