First Time Buyer Mortgages
Usually the largest purchase you’ll have made so far, buying a house is an exhilarating experience that can be both exciting and terrifying in equal parts.
Approaching the house buying process can seem daunting. Even after you’ve found the property you wish to buy, you still need to get a valuation and/or a survey, then choose a mortgage product, and a conveyancing solicitor.
It can also be very frustrating; there’s a sizeable amount of mortgage products on offer, but as mortgage lenders can change their criteria often and deposits can be high, that leaves many people who are looking for first time buyer mortgages very confused and bewildered.
Only a few years ago, there was a huge amount of first time buyer mortgages available to encourage people to get that foothold on the property market. It was actually possible, during the housing market boom which saw large property value rises each year, to get a mortgage without paying a deposit.
But these days house prices are fairly static and lenders require relatively large deposits, so this makes it even more important than ever before to get the very best mortgage deals for your personal circumstances.
How Do I Qualify For A First Time Buyer Mortgage?
All mortgages are likely to have slightly differing criteria, but the following may be viewed as being standard criteria you must be able to meet.
You will have to be aged 18 or over, at least one person applying for the mortgage must never have owned a property before, and you must of course need to demonstrate that your income satisfies the mortgage’s income criteria. It also helps to have a very good credit history.
In addition, in order to qualify for a first time buyer mortgage, you’ll need to have saved a certain amount of money to put down as a deposit as well as other criteria.
What Are The Benefits Of First Time Buyer Mortgages?
If you look around it’s possible to find special deals that have been developed by mortgage lenders that are designed to attract people looking for first time buyer mortgages. If you have good credit then it makes sense to shop around, because some mortgage lenders offer promotional incentives for first time buyers.
In the past, mortgage lenders have included incentives such as; a reduced level of deposit, or a reduced interest rate for a certain amount of time, or preferential fixed interest rates. It has even been possible to involve a third party such as parents as a guarantor for the mortgage.
Are There Any Disadvantages Related To First Time Buyer Mortgages?
The primary disadvantage, as with any mortgage, is that if you do not maintain your first time buyer mortgage repayments, then you could end up losing your home. While repossession is an extreme final step, ultimately if you can’t repay your mortgage then your home can be repossessed.
This of course would happen regardless of your circumstances, so whether you lose your job, or split up with a partner who was previously contributing to household expenses, you would need to make those mortgage repayments to avoid any further action.