First-Time Buyers
What is a first-time buyer mortgage?
First time buyer mortgages are for people who are new to the housing market.
Generally, you are considered a first time buyer if you’re buying a property you plan to live in as your main residence and you’ve never owned a property before.
Why would you need first time buyer mortgage advice?
Save for the deposit sooner
The deposit is a large barrier for many first-time buyers to overcome and getting your finances in order to save can seem difficult. Some first-time buyer mortgage options only require a 5% deposit instead of the standard 10%-20% for standard mortgages. You can also use the shared ownership mortgages available where you own between 25%-75% of the property and pay rent on the remaining amount. You only need to raise 5% deposit on the portion you own, meaning much less deposit is needed.
Employment status
Depending on how you are employed, this can affect what types of mortgages you can have. Full-time employment is seen as the least risky to lenders and opens up much more of the market. Contractors, self-employed, and zero-hour contract workers have different criteria and the best mortgage advice for first time buyers differs from person to person.
What first time buyer mortgages are available?
Shared ownership
This first-time buyer mortgage option is for first time buyers who can’t afford 100% of the property they wish to mortgage. This option allows you to buy a portion of the property ranging from 25%-75%, and paying rent on the rest of the property.
Joint Borrower Sole proprietor mortgage
This is a type of mortgage where not all parties to the mortgage are legal owners of the property. For example, if there are two borrowers in the scenario both will be mortgage borrowers, but only one will be named on the title of the property.
The First Homes Scheme
This is a government initiative that offers newly built homes to local first-time buyers and key workers at a 30%-50% discount on the market price.
Think carefully before securing debts against your home. Your home may be repossessed if you do not keep up repayment on your mortgage.