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Top Tips for first-time buyers

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Written by:
15/06/2012
A checklist of things a first-time buyer should consider before the all important mortgage application.
Top Tips for first-time buyers

1.Shop around

There are thousands of mortgage deals on offer in the UK, so it is vital that you research the market thoroughly and do not simply go for the first mortgage you are offered.

2. Save as big a deposit as possible

While there are mortgages available for those with just a 5% deposit, and even solutions for buyers with no deposit who have family to stand guarantor, as a basic rule, the bigger your deposit the lower the rate of interest you will be charged on a mortgage. So the more you can put down, the better.

3. Seek advice

If you feel lost or confused, then it could make sense to consult a mortgage adviser. They are fully qualified professionals who have access to a wide range of mortgage deals and can find you the best first time buyer mortgage to suit your needs.

4. Don’t be afraid to ask. Whether you are talking to a mortgage lender or an independent broker, make sure you understand everything that they are telling you. If there is something you don’t understand, don’t be afraid to ask. You are a first time buyer and are not expected to know it all. Taking out your first mortgage a huge financial commitment, so make sure you know exactly what you are getting into.

5. Read the small print

None of us like doing it, but it is vital that you look at the detail of your mortgage offer, and the lender’s terms and conditions.

6. Be realistic

Don’t try to borrow more than you can afford to pay back. When you buy your first home it is vital that you are able to comfortable meet your monthly repayments, and that you could continue to make them should interest rates rise. The lender will run checks to make sure you are not biting off more than you can chew, but you should also discipline yourself in this regard.

7. Be honest

Many lenders these days will base how much they will lend you on your income and your outgoings. Do not be tempted to overtstate your income or to play down your expenditure or other debt commitments. Note that it is illegal to lie about your income on a mortgage application form.

8. Think ahead

When selecting your mortgage, think about your next likely home move or next mortgage. As a first time buyer, this may be the last thing on your mind. But it is important. Find out, for example, whether the lender you have chosen will offer you a full range of deals when you get to the end of your current arrangement. Many only offer their best deals to new customers, so next time round you could be forced to move lender for the best rate, which can take time and cost money.

9. Shop around – again

Once you have found the mortgage deal you’re happy with, shop around again for your insurance. You will need buildings insurance and are stongly advised to take out contents cover and life insurance. And possibly mortgage payment protection insurance. Your mortgage lender may offer to sort this out for you, but remember that they are not insurance specialists and may not offer the best cover or the cheapest rates.

10. Be happy

First-time buyers face a huge challenge just getting on the property ladder these days. Congratulate yourself for achieving this feat !

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