First Time Buyer Mortgages
If you’re buying your first home, mortgage advice can seem complicated and overwhelming. At Stan Sherlock Associates, our first-time buyer mortgage advice will help you understand the process and support you to achieve your dream of owning your first property.
Buying a home is likely to be the biggest financial undertaking you’ll ever make and many first-time home buyers are understandably concerned about the commitment and risks involved.
Our friendly specialist mortgage advisers will take the time to understand your needs and worries and hold your hand from start to finish.
We will review your circumstances and look at your income, debt, day-to-day outgoings, employment and the size of your deposit to assess what you can afford to borrow now and in the future. We’ll talk you through the types of mortgages we think are right for you and the lenders available to you.
We’ll also ensure you understand your mortgage offer and the longer-term financial implications of that deal including how it could be affected by changing circumstances, such as interest rates or overpayments.
We can access deals and incentives, which may include cashback on your mortgage, reduced mortgage interest rates or lower levels of deposit against your property value. We know the first-time mortgage advice we offer you as a new home buyer is vital to help you find the right mortgage and achieve your dreams and we take that role very seriously!
First time buyer? The Help to Buy scheme could be for you:
If you're aged 18 – 40, you can save into a Lifetime ISA to help you buy your first home and save for your future.
You can save £4,000 a year into your Lifetime ISA until you're 50 and the government adds a 25% bonus to the money you save, up to a maximum of £1,000 annually.
Frequently Asked Questions
There are two ways to apply for a mortgage as a first-time buyer, the traditional mortgage route and the governments help-to-buy scheme. It is now commonplace to appoint a financial advisor to act on your behalf and find the right mortgage deals for your situation. A mortgage provider will consider individual/joint income and outgoings and, if affordable, agree to a mortgage arrangement in principle. The terms and conditions will vary dependent on your financial circumstances.
The help-to-buy scheme was introduced to assist first-time buyers looking to acquire their first home and applied to new builds only. This is a shared ownership option, with the homeowner required to fund upwards of 75% of the property’s value and a further 5% through a deposit with the government funding the balance. The homeowner can increase their interest in the property by buying part (or all) of the government's share at the market price. As a first-time buyer, advice from an experienced mortgage broker can be invaluable.
In times of economic growth, which ultimately reflects on house prices, it can be possible to obtain mortgage finance with a deposit of as little as 5%. In order to access some of the more competitive mortgage deals, you would likely require a 20% deposit. The deposit acts as an insurance policy for mortgage lenders, providing a degree of protection if house prices were to fall.
There is also the government help-to-buy program. This involves shared ownership through a government-backed scheme, with a typical deposit anywhere from 5% upwards. Even though the statutory affordability test has been removed by the authorities, mortgage lenders will still have an eye on the risk/reward ratio.
The first-time buyer mortgage market is very competitive, offering a variety of options such as:-
Fixed-rate mortgages are the most popular amongst first-time buyers, offering a degree of certainty in the early days of the mortgage and a potential discount on the mortgage lender's standard variable rate.
Standard variable rate mortgages
A standard variable mortgage rate is heavily influenced by base rate movements. While a useful tool when interest rates are falling, it can be counter-productive for homeowners when interest rates are rising.
Tracker rate mortgages
While standard variable rates are influenced by base rates, tracker mortgage rates are formally linked to a measure such as base rates. They tend to be set at a rate which is a fixed percentage above or below the base rate.
Discount mortgage rates are directly linked to the mortgage lenders standard variable rate with a fixed discount. The discounted rate will traditionally last anything up to 3 years.
An offset mortgage allows you to consolidate mortgage debt with savings and regular income. While the outstanding mortgage balance will vary over the month, it can lead to long-term interest savings.
The UK mortgage market is extremely well developed and very competitive. Whether looking at a fixed rate or a discount rate, these offers can be relatively short-lived but are an interesting way to entice first-time buyers into the market. Mortgage companies take a long-term view on first-time buyers, often reducing their initial returns for cross-marketing opportunities and the sale of additional services further down the line.
Even though first-time buyers tend to get a better deal on average, mortgage lenders are now more acutely aware of the dangers of neglecting existing customers.
Need to know more? Get in touch with our team:
Why work with us?
At Stan Sherlock Associates, arranging a mortgage is not a one-off transaction. We aim to build long term relationships with our clients and provide you with an advice service over the lifetime of your current mortgage, and beyond, which ensures you always have the right deal for your situation.
Although based in Carlisle, our clients come from much further afield. We regularly work with clients from across Cumbria (including Kendal, Keswick, Penrith, Whitehaven and everywhere in between), the Scottish Borders and North East England. Many of our mortgage advice services can be provided by phone and email but our mortgage advisers are always happy to meet you face to face.