THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
First Time Buyer Mortgages
Before you can start thinking about your new home, you need to know how much you can borrow, how much you will need for a deposit and any associated costs and fees. We can calculate and explain all of this to you so that you can begin your search prepared and confident, with your Agreement in Principle to hand.
We will also assess your eligibility for government schemes that may be of benefit, and how to apply
AFFORDABLE HOUSING
The UK Government is currently running several schemes, designed specifically to help first time buyers, which may be of benefit to you, if you are eligible. We can help you understand the schemes and how it could work for you.
Help to Buy: Shared Ownership
You can buy a home through the shared ownership scheme if you cannot afford all of the deposit and mortgage payments for a home that meets your needs. You buy a share of the property and pay rent to a landlord on the rest.
When you buy a home through shared ownership, you:
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The share you can buy is usually between 25% and 75%. You can buy a 10% share on some homes. You can take out a mortgage to buy your share or pay for it with savings. You’ll also need to pay a deposit, usually between 5% and 10% of the share you’re buying.
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Pay rent to the landlord for the share they own
- usually pay monthly ground rent and service charges, for example towards the maintenance of communal areas
You can buy:
- a new-build home
- an existing home through a shared ownership resale scheme
Shared ownership homes are offered by housing associations, local councils, and other organisations.
Lifetime ISA (LISA)
You can use a Lifetime ISA (Individual Savings Account) to buy your first home or save for later life. You must be 18 or over but under 40 to open a Lifetime ISA. You can put in up to £4,000 each year, until you’re 50. You must make your first payment into your ISA before you’re 40.
The government will add a 25% bonus to your savings, up to a maximum of £1,000 per year.
Lifetime ISA – GOV.UK (www.gov.uk)
First Homes Scheme (Discounts for First Time Buyers)
If you’re a first-time buyer, you may be able to buy a home for 30% to 50% less than its market value. The home must be your only or main residence.
This offer is called the First Homes scheme.
The home can be:
- a new home built by a developer
- a home you buy through an estate agent, which someone else bought before through the scheme
The First Homes scheme is only available in England.
First Homes scheme: discounts for first-time buyers: Overview – GOV.UK (www.gov.uk)
Right to Buy : Buying Your Council Home
Right to Buy allows most council tenants to buy their council home at a discount.
Right to Buy: buying your council home: Overview – GOV.UK (www.gov.uk)
Right to Acquire : Buying Your Housing Association Home
You might be able to buy your rented housing association home at a discount through the Right to Acquire scheme. You and your landlord must meet the eligibility requirements to apply
Right to Acquire: buying your housing association home: Overview – GOV.UK (www.gov.uk)
Terms and conditions apply, to all of the schemes. For more information, or to see whether these schemes are appropriate for you, call us now, or click on the contact us tab, and we will be happy to help.
THE DIFFERENT TYPES OF MORTGAGES
Standard Variable Rate or SVR
With this type of mortgage your interest rate is set by your mortgage lender and can both rise and fall in line with the Bank of England bank rate changes, i.e it is variable, but not necessarily at the same time or by the same amount.
Repayment Mortgage – also known as a capital and interest mortgage.
With this type of mortgage, you repay part of the amount borrowed together with the interest being charged each month. With each monthly payment, you are repaying part of the original loan until, the end of the term, when you will own the property outright.
Flexible Mortgages
Flexible mortgages allow you to make overpayments and underpayments on your mortgage whilst giving you the option to take payments holidays, you generally do not have restrictions on overpayments.
Buy to let Mortgages.
A mortgage product designed specifically for people looking to buy a property with the intention of becoming private landlords. Wether you are a first time landlord, or experienced, landlord with a portfolio. Typically, but to let mortgage, interest rates may be slightly higher than an ordinary mortgage
Discount Variable Rate Mortgage
This type if mortgage, allows you to benefit from a discount on the lender’s standard variable rate. If the lender’s standard variable rate (SVR) increases or decreases, so does the discounted rate. Typically, the shorter the discounted period the larger the discount.
Tracker Rate Mortgage
A Tracker mortgage is linked to the Bank of England Base Rate and can rise, fall or remain unchanged each month in line with the Base Rate. They generally run at a % above the base rate.