Your first home is one of the most important milestones for a lot of people and at Green Mortgages we aim to take away the stress to allow you to enjoy this special moment in your life.
Buying your first home isn’t something you’re likely to forget. It’s both exciting and daunting at the same time, with the decisions you make significantly impacting your medium to long-term future. At Green Mortgages, we take away the stress of this process, allowing you to enjoy this special milestone in your life.
Getting A Good Mortgage Deal
When you’re caught up in all the excitement of choosing your first home, it’s easy not to pay too much attention to the mortgage deal you’re getting.
Choosing the right mortgage deal is critical to your financial future – making understanding your interest rates and monthly payments a vital part of your journey.
Banks & Building Societies
If you opt to look for a mortgage on the high street, you will discover hundreds of banks and building societies with thousands of mortgage products available. From fixed rates to tracking and discounted rates, it can be hard to get your head around it all.
Banks and building societies will only tend to offer you what is convenient – sadly sometimes not offering you enough money to buy your dream property, or even refuse applications altogether.
How A Mortgage Broker Can Help
Fortunately, by using an independent whole of market mortgage broker, if there is a first-time buyer mortgage product available for you, we’ll find it. Our qualified advisors will not only help ensure you’re looking in a realistic price range but also find out if the monthly payments will be affordable for you.
At Green Mortgages we are your guide to getting the best mortgage deal available. Call one of our advisors today for more information.
Speak to us now 01244 955 399 or request a callback from our team.
These questions help give some guidance to buyers from all angles of the property ladder. If you have any questions that aren’t covered opposite or if you would like a little more clarification on any of the points discussed, our team of experienced advisors are on hand to help you through any part of the buying process
A first-time buyer is someone who is purchasing a house for the very first time and doesn’t already own (or hasn’t previously owned) property before. Couples qualify as first-time buyers, so long as neither person owns (or has owned) a house in the past.
If you’re buying your first house and own (or have owned) commercial property such as a shop, bar or restaurant, you still qualify as a first-time buyer, provided that the commercial property has never had living quarters attached to it. The realm of first-time buyers refers only to residential properties.
If you’re buying your first house but you’ve inherited a house or someone has bought a house for you, you don’t qualify as a first-time buyer, even if you’ve never technically bought a house before. You also lose first-time buyer eligibility if you’re planning to rent out the house you’re buying (what’s known as buy-to-let).
Getting a mortgage - particularly your first mortgage - is a huge financial decision that requires careful thought, research and number-crunching. It’ll have a huge impact on your financial future, which is why it’s important to seek expert advice before making a decision. Green Mortgages are expert mortgage brokers who can guide you through the entire process and find the first-time buyer's mortgage that’s right for you.
Getting a mortgage for the first time can be a complicated and daunting process. In order to get approved for a mortgage, you’ll be assessed by a lender and will need to convince them that you’re able to repay your mortgage. You can use our mortgage calculators to see how much money you’ll be able to borrow and how much your monthly repayments will be.
Here’s what you need in order to be approved for a mortgage as a first-time buyer:
As a first-time buyer, there are a wide range of mortgage options available to you. Which mortgage you choose depends on how much you’re borrowing, your preference of paying the interest and your attitude towards risk.
First, you need to decide how you want to pay the interest on your mortgage. You can pay this in four different ways:
Once you’ve decided how you want to repay your mortgage, you then need to think about what type of interest rate best suits you. You can choose between a fixed rate that stays the same for a set period of time, or a variable rate that fluctuates, meaning you might pay less interest one month, but you may end up paying more interest another.
There are a wide range of mortgages to choose from, including:
Fixed rate – Where you pay the same amount each month, giving you stability, security and peace of mind when it comes to budgeting. Most fixed rate mortgages come with an introductory period where you get a better interest rate for a certain length of time — usually between 2 and 5 years. However, once this period expires, you will be placed onto your lender’s standard variable rate, usually carrying higher interest rates that fluctuate from month to month. This is when it’s a good time to remortgage.
Variable rate — Where the amount of interest you pay varies from month to month, depending on the Bank of England’s base rate. They’re more of a gamble: if interest rates fall one month, you’ll end up paying less. But if interest rates rise another month, you’ll end up paying more. Types of variable rate mortgages include a discounted rate, where the interest rate is slightly below your lender’s standard variable rate; a tracker mortgage, where the interest rate is a small percentage above or below the Bank of England’s rate; and a capped rate mortgage, which follows your lender’s standard variable rate but has a cap on how high it goes.
As a first-time buyer seeking a mortgage, you get access to certain benefits that other borrowers don’t. This mainly involves help from Government schemes and policies, including:
Lifetime ISA — A Lifetime ISA (LISA) rewards you for saving to buy a house. The Government will boost your savings by 25% and you can deposit up to £4,000 a year – receiving a maximum of £1,000 per year in help. Lifetime ISAs are available to those between the ages of 18 and 40 who are looking to buy a house under £450,000. The Government previously offered a Help to Buy ISA, but these were discontinued on November 31, 2019.
Help-to-Buy Equity Loan — A Help to Buy Equity Loan is where the Government lends you up to 20% of the value of your house. The loan is interest-free for the first five years. Useful option for those with a 5% deposit, as it means you’ll only need a mortgage worth 75% of the value of your house, as the Government will cover the remaining 20%.
Shared Ownership — Shared ownership is available to first-time buyers whose household income is less than £80,000 a year. You take out a mortgage to purchase a portion of your home (between 25% and 75%) and you pay rent to the Government or a housing association on the remaining value. You might be able to buy a larger share of your house when you can afford to.
Stamp Duty Relief — Stamp Duty is the tax you pay when buying a property over a certain price in the UK. The higher the value of your house, the more tax you have to pay. For existing homeowners who are buying a new house, the Stamp Duty tax rate currently looks like this:
+ 0% tax on the first £125,000.
+ 2% tax on the portion from £125,001 to £250,000.
+ 5% tax on the portion from £250,001 to £925,000.
+ 10% tax on the portion from £925,001 to £1.5 million.
+ 12% tax on the portion above £1.5 million.
Stamp Duty Relief offers discounts and more flexible tax bands for first-time buyers. For first-time buyers, the Stamp Duty tax rate looks like this:
+ 0% tax on the first £300,000 of your house.
+ 5% tax on the remainder up to £500,000 (the portion from £300,001 to £500,000).
If your house is worth more than £500,000, you won’t be eligible for Stamp Duty relief and will pay the standard tax.
Making your first step onto the property ladder can be a daunting and confusing process. You’re only a first-time buyer once in your life and the decision you make will have a huge impact on your financial future, so it’s important that you make an informed decision. That’s where Green Mortgages come in.
We’re a Cheshire-based mortgage broker with a team of experienced, friendly and knowledgeable advisors who are here to help you find the right mortgage for you. We’ll sit down and discuss your situation to find the best first-time buyer mortgage based on your circumstances.
Green is an independent, whole of market broker with access to over 140 lenders – providing you with a wide range of mortgage options. Thanks to our strong connections, we can offer you exclusive mortgage deals you won’t get by going straight to lenders.
At Green, we pride ourselves on our excellent customer service. We explain everything in an easy-to-understand fashion while guiding you through the process of securing your first-time buyer mortgage. Our red carpet service makes a potentially stressful time for you as a first-time buyer as smooth as possible.
If you’re looking for a first-time buyer mortgage in Chester or further afield, get in touch with Green Mortgages today.