Being a first time buyer and making your first large financial commitment, it can be a rather daunting prospect. Let us help.
It’s quite possible that you’ve already spent years saving up for the deposit for your first home and with lenders changing the percentage of deposit criteria on a regular basis, you are probably wondering if you will ever get on the ladder.
At Sheffield Money, this is a market we know extremely well. So, if you’re still saving, or have been lucky enough to receive support from your relatives, then talk to us before setting out on your house-buying journey.
There are lots of schemes available for first time house buyers, such as the shared ownership scheme, which you could possibly take advantage of.
The more deposit you have, the better, as a higher deposit will generally attract a lower mortgage rate. However, do talk to us, because mortgage products change rather often these days and the percentage deposit you need will vary.
Mortgage lenders will generally have a maximum LTV (loan to value) that they’re prepared to offer you. For example, if you’re looking at a property with a value of £200,000 and the lender offers you £180,000, this means your LTV is 90%, so your deposit would be 10% which equates to £20,000.
When saving for your deposit, don’t forget to save extra for things like solicitor fees, surveys, stamp duty, home insurance, removal costs, mortgage arrangement fees, etc.
Stamp Duty Land Tax (SDLT), commonly known as stamp duty, is a tax you may have to pay when you purchase a new home in England. If you’re purchasing in Scotland you’ll have to pay Land and Building Transaction Tax or in Wales its Land Transaction Tax.
If you’re buying a property that falls below the Stamp Duty threshold, you won’t have to pay any Stamp Duty. If you’re a first time buyer, along with anyone else you’re buying with, you won’t have to pay any Stamp Duty on properties under £300,000.
This scheme allows you to buy a New Build property with an equity loan from the government under the Help to Buy – Equity Loan.
The equity loan is a maximum of 20% of the property value (to a max property value of £600,000 with a minimum deposit of 5%. We will guide you through the process and tell yu if you qualify and how much you can afford to purchase for using this scheme. We’ll then recommend the most suitable lender and mortgage product for you.
If you’re buying a property that falls below the Stamp Duty threshold, you won’t have to pay any Stamp Duty. If you’re a first time buyer, along with anyone else you’re buying with, you won’t have to pay any Stamp Duty on properties under £300,000.
You will find that the estate agent who is arranging your property purchase will want to see an ‘agreement in principle’ (AIP) or ‘decision in principle’ (DIP) to ensure that you can obtain a mortgage. This is something that we can provide you with. Please note – this will depend on your circumstances and will be subject to further underwriting from the lender if you decide to proceed.
Only the full mortgage application and assessment along with a property valuation will determine if your mortgage is offered. So whether you are looking on the open market or a new build, give our experienced team a call to book in to discuss this further.
