Purchasing your first property is an exciting time of your life. However, there are a lot of things to consider when looking for your perfect home and too much information can be overwhelming. Here are my top tips for first time buyers:
Sort out your finances
A mortgage lender will usually ask for a deposit equal to 10% of the purchase price. You will need to calculate how much money you have for a deposit and where the deposit is coming from – is it your own savings or a gift from a relative?
Calculate what you can afford to pay back each month. Consider if you pay any rent currently and what you could afford on a monthly basis.
Most banks have online calculators and there are also comparison websites to find out how much you can borrow based on your circumstances. From this, you will then have an idea of your budget for a purchase price of a property, and how much it will be each month.
Consider Help to Buy schemes
There are schemes and incentives on the market for first time buyers which include you contributing only a 5% deposit. Do your research as to what scheme could benefit you. Many of the schemes are only available on new build properties so bear this in mind when deciding what type of property you wish to purchase.
It is important to check the market and rates for mortgages. The different products, rates and fees can be confusing at the best of times, so do your research carefully. If you are still unsure, you can seek advice from a mortgage broker (you can find these online or estate agents can usually recommend someone). Some brokers may charge a fee. However, this will take the stress off you of researching the right mortgage for you.
When buying your house, you will need to pay stamp duty and legal costs, as well as removal costs. It is important to budget for this. Your solicitor will advise you on how much the fees and stamp duty are.
Once you have purchased a property, the responsibility of it is yours. It may be worth putting additional funds aside to cover household expenses and repairs after completion.
You will take over responsibility for insuring the property on exchange of contracts. Buildings insurance is separate to contents cover. Shop around to ensure that you get the best deal.
Be realistic in time scales
A property purchases take on average 6-8 weeks to go through or 10-12 weeks if it is a leasehold property. Bear this time frame in mind when applying for mortgages, organising removals and terminating any tenancy agreement.
Keep calm and carry on!
Purchasing a house can be a stressful time. Try and enjoy the process as it will be worthwhile!