The 10 commandments for first-time buyers

A couple outside a house

Your Money explains the ten golden rules buyers should obey to get their first step onto the property ladder.

The Ten Commandments for First-Time Buyers

1. Do your research

When you're going through the mortgage process there may be words and terms that pop up which you may not understand. First-time buyers need to know as much as they can about the market. What's a fixed rate, a tracker or a standard variable rate? Once you understand these terms it will be much easier for you to decide which type of mortgage you should go for.

2. Speak to an adviser

It can be useful to talk to a mortgage adviser who can help clear up any confusion for you when it comes to purchasing your first home. Save what you can The size of your deposit will have a significant effect on the type of mortgage you will be able to get. Generally, the bigger the deposit you have, the lower the interest rate you will be able to get.

3. Consider hidden costs

Make sure you draw up a sensible budget considering more than just your monthly mortgage repayments, because you will have to factor in the costs of Stamp Duty, solicitors' and mortgage arrangement fees, all of which could make a serious dent in your deposit. Once you have moved into your new home, you will be required to take out buildings insurance, while contents insurance is highly recommended. If your house is in need of repair you will also need to have money put aside to fix any problems.

4. Government schemes

To help first-time buyers get onto the property ladder, the Government has set up two schemes. It might be worth finding out about them and whether you would qualify for one.

5. Bank of Mum and Dad

If the Government schemes are not for you, fear not as there are other alternatives. Many young househunters' parents have seen their home's value rise substantially compared to their mortgage and could lend a lump sum for a deposit, enter into a joint mortgage, or act as a guarantor. Specialist lender Aldermore offers a Family Guarantee mortgage which is available up to 100% loan-to-value (LTV) and has a two- or three-year fixed rate.

6. Partner up

It's always much easier to purchase property if you are buying with someone. But if you haven't found 'the one', or are in a relationship but fear what might happen if things don't work out, there is the option of teaming up with a friend or family member. Pool your deposits, work out a legally binding contract in case things go pear-shaped and apply for a joint mortgage to boost borrowing power. (

7. Be flexible

When searching for a property, look at how flexible you can be with the location. David Hollingworth, director of communications at brokerage London & Country, says: "The truth is that many first-time buyers could benefit from moving to a different area. A two-bed flat in London could equal a three-bed house in Manchester or Leeds, where the cost of living is much lower. It's important to remember that a move would not have to be permanent, just enough to get your foot on to the property ladder. Once you have that, it will be much easier for you to return in later life."

8. Draw up a budget

To help you stay on top of your finances, sit down at least once a month and work out the costs of all your bills, weekly shopping and other outgoings. Once you have worked out how much you're paying, look around to see if you can find cheaper options elsewhere to help you save money.

9. Rent out a room

If you are able to stretch to a bigger mortgage but are worried about your monthly repayments, it is worth considering renting out a room to help foot the bill. Generally, where house prices are high, rents tend to follow so renting out a room could turn out to be very advantageous for you. Buying a house is one of the biggest steps you will take in your life, and the costs involved will probably be on a scale that you have previously not dealt with before.

10. Don't be shy of asking for help.

Mortgage advisers are on hand to offer guidance and help with the application process and it can make sense to take advantage of their expertise to help with your first purchase.

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