The prospect of buying a property for the first time can be daunting. What level of deposit will I need? Will my earnings be enough to allow you to borrow enough? Will I be able to afford the mortgage repayments? These are just some of the questions that prospective borrowers will ask themselves before starting on the journey to home ownership.
It is important to remember that even experienced buyers, people who have purchased in the past, have the same nagging doubts.
Additionally having to deal with lenders directly can be as painful as it is time consuming.
The key starting point is your level of deposit. Post Covid, an absolute minimum of 10% deposit is required, unless you are looking at a scheme, such as Help to Buy or Shared Ownership. However if you have 15% deposit you are giving yourself a wider range of lenders to choose from compared to the 10% market, as well as seeing far less eye-watering rates. Tied to this is whether you are buying a house or a flat. Some lenders have stricter rules when it comes to buying a flat.
Affordability is the essence of what helps a lender decide if your income is enough to lend you the necessary mortgage amount. Essentially it is a budget plan worked out using your income compared to your outgoings. Each lender has a slightly different way of calculating someone’s overall affordability and the customer facing parts of lenders websites do not always account for all the nuances of these numbers. Each person is different!
Now just because a lender has agreed to lend you some money, does not necessarily mean you are comfortable with the suggested repayments. Some lenders may have agreed to lend you more than another lender has, but the rates could end up being a lot higher. This could mean you are now living in your dream home, but with no means to be able to ever leave it due to all of your money being spent on the mortgage and other living costs, such as utilities.
It has never been more important to reach out seek a trusted, knowledgeable mortgage adviser. At TR Financial we have a we have a wealth of knowledge and a friendly approach to help First Time Buyers achieve their property goals.
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