Information For 1st Time Mortgage Buyers
Hot Topics
- Do I Need a Guarantor?
- If your lender is concerned about your ability to meet your mortgage commitments, they may ask you to provide a Guarantor.
- How Is Interest Calculated On a Mortgage?
- Interest is charged in different ways depending on what kind of mortgage you have.
- Can I Get a Mortgage With A Group Of Friends?
- You are allowed to get a mortgage with up to three friends in the same way that you are allowed to get a mortgage with a partner – an idea that is appealing to more young professionals at the moment.
- What Are The Different Ways You Can Pay Off a Mortgage?
- Capital & Interest - otherwise known as a repayment loan. The borrower pays an amount each month to cover the amount borrowed and the interest charged on that.
- I Have Been Turned Down For A Loan Or Credit Card, Will I Still Be Able To Get A Mortgage?
- If you have been turned down for a credit card or loan, then you need to find out why your application was rejected before you apply for a mortgage.
Your first mortgage will be the most significant financial undertaking of your life so far, but how exactly do you go about getting a mortgage?
More importantly still, how do you go about getting the right mortgage ?
1st time buyers often rush into taking out a mortgage, many of them without any advice to help them make the right choices. Today’s mortgage market is extremely competitive with thousands of different products available from hundreds of providers. Choosing the right mortgage is difficult even for a trained advisor, never mind a 1st time mortgage buyer!
Please ensure that you read all of the information below before applying for a mortgage!
Borrowing Limits
The total amount you can borrow will depend on your income. Usually lenders use multiples of 3.25 times the gross salary of a single borrower.
A couple can get 3.25 times their main income plus one times their second income. Some lenders will allow you to take 2.5 times your combined income.
Loan To Value
Some lenders will only lend you a set percentage of your property value, this reduces the chance of the property being worth less than the amount you borrowed should you default on your payments.
Stamp Duty
You also have to pay stamp duty, which is 1% of the purchase price for properties between £60,000 and £250,000, 3% up to £500,000, and 4% over that amount.
Surveys, Legal fees, Arrangement Fees and other costs
You will have to pay for the survey, the valuation of your property, and the solicitors fees. All of these add to the cost of your mortgage. Check your mortgage offer as some lenders will provide some of the necessary surveys and check ups as part of your mortgage offer.
Mortgage Indemnity
A Mortgage Indemnity Guarantee is insurance covering the lender against you defaulting on your payments when your property is worth less than the current loan.
1st Time Buyer - Buy to Let Mortgages - Capped Rate Mortgages - Discount Mortgages - Fixed Rate Mortgages - Flexible Mortgages - ISA Mortgages - Low Setup Cost Mortgages - Self Cert Mortgages - Tracker Mortgages - 100% Mortgages Cashback Mortgages - Adverse Credit - Buy to Let - Commercial Mortgages - Company Directors - Equity Release - Fixed Rate Mortgages - Income Multiples - Interest Rates Explained - Mortgage Glossary - Mortgages Explained - Previously Declined - Refinance Mortgages - Repaying Mortgages - Right to Buy Mortgages - Self Employed - Unusual Properties - Variable Rate Mortgages