Helping first time buyers onto the property ladder
First time buyers have never faced such a daunting task - even though interest rates are at their historical lowest for many years the ability for first time buyers to obtain finance for house purchase has never been more difficult, that's where the role of advice really comes into it's own.
Here’s a quick run down of some of the ways ‘first timers’ are overcoming the obstacles to home ownership:
Don't allow yourself to be stretched financially: Recently lenders have reduced the levels of loans to First Time Buyers expecting a greater level of deposit and sometimes guarantees from parents to support the application.
Joint ownership: Buying a house with friends or family increases your buying power and the value of the property you can afford, since you are pooling your resources. But there are a couple of very serious things to consider before going into such an agreement. You can’t guarantee that you will find living together easy – especially true for young couples who may also be planning, or already have, a family. And finances are, of course, one of the main sources of potential strife. So making sure every aspect of the arrangement is crystal clear, and everyone knows what they’re paying for – and how they are going to do that is an absolute essential. You even need to think about making wills, just in case one of the parties to the agreement should die.
Shared equity: Through the HomeBuy scheme, the government is offering assistance to first time buyers who are ‘key workers’. In a nutshell, you take out a large mortgage for 75% of the property value for example, and get a low cost equity loan for the balance. It’s a little complex, but does help some people who otherwise simply couldn’t afford to buy property.
Help from parents: More and more first time buyers are getting a helping hand from their parents.
There are also schemes available where parents and even grandparents can help by guaranteeing the mortgage repayments, very useful if a large deposit is not available.
Whichever of these options appeals, one thing is absolutely consistent: every first time buyer will benefit from fully qualified expert financial advice. There are many ways to go about taking that big step onto the property ladder – but your first move should be to talk to a broker or financial advisor.
Your home will be repossessed if you do not keep up repayments on your mortgage.
You can choose how we are paid for mortgages; pay a fee, usually 0.5% of the loan amount or we can accept commission from the lender. In addition to this we will charge a £325.00 administration fee once a mortgage offer has been secured.
The Financial Conduct Authority (FCA) does not regulate will writing and some forms of secured loans.