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First Time Buyer Guide

Buying a house for the first time

Getting a mortgage and deposit

Getting a mortgage is a crucial aspect of buying a house. Here’s what you need to know:

How much is a house deposit?

The deposit amount varies depending on the lender and the type of mortgage you choose. Typically, the deposit is between 5% and 20% of the property’s value. However, some lenders offer mortgages with a 0% deposit.

Understanding a Mortgage in Principle

Before you can put in an offer on a property, you need a mortgage lender to confirm that it is prepared to lend you the money. This is called a mortgage or decision ‘in principle’. To get assurance on what you can realistically borrow, you need to complete a mini application with your mortgage advisor to submit to a lender.

Loan to Value

Loan to value (LTV) is the percentage of your home that’s covered by your deposit, versus the amount covered by your mortgage loan. The LTV ratio is calculated by dividing the mortgage amount by the property’s value. Generally, the lower the LTV ratio, the better the mortgage deal you’re likely to get.

Different types of mortgages

There are several types of mortgages available, including:

  • Repayment mortgages: You pay back the mortgage and the interest over a set period.
  • Interest-only mortgages: You only pay the interest on the mortgage, and the capital is repaid at the end of the term.
  • Fixed-rate mortgages: The interest rate is fixed for a set period, usually between two and five years.
  • Variable-rate mortgages: The interest rate can change at any time, depending on the lender’s standard variable rate.
  • Tracker mortgages: The interest rate tracks the Bank of England base rate.

Costs of buying a house

Purchasing a home is a significant financial investment, and it’s essential to understand the costs involved before starting the process. The following are the costs you need to consider when buying a house:

  • Deposit: The deposit is the amount you pay upfront to secure the property. The deposit amount varies depending on the lender and the type of mortgage you choose. Typically, the deposit is between 5% and 20% of the property’s value.
  • Stamp duty: Stamp duty is a tax you pay when purchasing a property. The amount of stamp duty you pay depends on the property’s value and whether you’re a first-time buyer or not.
  • Legal fees: You’ll need to hire a solicitor or conveyancer to handle the legal aspects of buying a property. The legal fees vary depending on the solicitor or conveyancer you choose.
  • Survey fees: A surveyor will inspect the property to identify any issues that may affect its value. The survey fees vary depending on the type of survey you choose.

Read through our guide about the costs of buying a house for a better understanding of the fees and payments you’ll have to make before moving in.

Property Search & Viewing

When searching for a property, it’s important to have a clear idea of what you’re looking for. Here are some tips to help you find your dream home:

  • Location: Consider the location of the property and whether it’s close to amenities such as shops, schools, and transport links. You may also want to research the neighbourhood to ensure that it’s safe and has a good reputation.
  • Property type: Decide on the type of property you want, such as a house or a flat. You may also want to consider the number of bedrooms, bathrooms, and other features that are important to you.
  • Budget: Determine your budget and stick to it. This will help you avoid overspending and ensure that you can afford the monthly mortgage payments.
  • Viewings: Attend viewings and ask questions about the property. This will help you get a better idea of what the property is like and whether it meets your needs.

Legal

The legal aspects of buying a property can be complex. Here’s what you need to know:

Searches when buying a house

Your solicitor or conveyancer will carry out various searches to ensure there are no issues with the property. The searches include:

  • Local authority search: This search reveals any planning permissions or building regulations that may affect the property.
  • Environmental search: This search reveals any environmental issues that may affect the property.
  • Water and drainage search: This search reveals any issues with water supply and drainage.

Read through our guide on searches when buying a house to gain a clearer understanding of the different searches involved and how long they will take.

Making an offer

When you find a property you like, you’ll need to make an offer. Here’s what you need to know:

  • Offer: Make an offer on the property through the estate agent.
  • Acceptance: If the seller accepts your offer, you’ll need to pay a deposit to secure the property.
  • Exchange of contracts: You’ll exchange contracts with the seller, and the sale becomes legally binding.
  • Completion: You’ll complete the purchase by paying the remaining balance and receiving the keys to the property.

Moving in

Once you’ve completed the purchase, it’s time to move in. Here are some tips to help you settle in:

  • Utilities: Set up your utilities, such as gas, electricity, and water. You can contact your local utility companies to get started.
  • Insurance: Make sure to set up your home insurance as well as content insurance to protect yourself. Home insurance covers the structure of your home, while content insurance covers your personal belongings.
  • Decorating: Decorate it to your taste. You can start by painting the walls, hanging curtains, and adding some indoor plants. You can also add some personal touches such as family photos, artwork, and decorative items.
  • Organise your belongings: Unpacking can be overwhelming, so it’s important to have a plan. Start by organising your belongings into categories such as kitchenware, clothing, and electronics.
  • Explore your new area: Take some time to explore your new area and get to know the local shops, restaurants, and attractions.

Tips for first-time homebuyers

Here are some tips to help you navigate the homebuying process:

  • Research: Do your research before making an offer on a property. Look at the local area, the property’s history, and the current market conditions. This will help you make an informed decision and avoid any potential pitfalls.
  • Mortgage: Get a mortgage agreement in principle before you start looking for properties. This will give you an idea of how much you can borrow and help you narrow down your search.
  • Survey: Get a survey done on the property before you buy it. This will highlight any potential issues with the property and help you make an informed decision.
  • Negotiate: Don’t be afraid to negotiate on the price of the property. If there are any issues with the property, you can use these to negotiate a lower price.

How can we help

If you’re a first-time buyer and need assistance with buying a property, Hamptons can help. We have a team of experts who can guide you through the homebuying process and help you find your dream home. We offer a range of services, including:

  • Mortgage advice: Our mortgage advisors can help you find the right mortgage for your needs and budget.
  • Property search: We have an extensive database of properties for sale, and we can help you find the perfect home.
  • Legal services: We can recommend solicitors and conveyancers to handle the legal aspects of buying a property.
  • Surveying: We can arrange for a surveyor to inspect the property and identify any issues that may affect its value.

We understand that buying a house for the first time can be daunting, and we’re here to help. Contact us today to find out how we can assist you.

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