First Time Buyer Best deals and comprehensive advice

  • Up to 95% purchase price
  • Higher the deposit lower the rate
  • Up to 5x income multiples
  • Special deals for professionals
  • Fixed and tracker rates
  • Exclusive products
  • Adverse credit

Those who have never owned a property or not had a mortgage in the last 3 years. Loan up to 95% may be available, however the number of lenders available at that level is limited (since the credit crunch). Those who may not have sufficient income can use a guarantor, normally a parent to provide surety against the loan.
Special interest to First Time Buyers are the new government sponsored schemes to help them in to the property ladder.
Deals are also available for those in a profession, or those that are newly graduated (from a recognised University in the last 5 years).

Government sponsored schemes for Fist Time Buyers

  • Help to buy: Equity Loans
  • Help to buy: Mortgage guarantee
  • Shared ownership schemes
  • NewBuy
  • Help to Buy equity loans.

Available for purchase price up to £600,000 for both FTB and home movers. You cannot own another residential property or allowed to sub-let the property.
How it works

  • You contribute: 5% of purchase price.
  • Governmant provides you a loan: up to 20% of purchase price
  • Lender: borrow rest e.g. up to 75% from lender.
  • Must use a registered Help to Buy agent (H2B) and the property needs to come from a H2B registered builder.

Pros

  • Minimal deposit to enter the property ladder.
  • No interest payments in the first 5 years- so a very efficient way to borrow money.
  • Low interest for a period after 5 years
  • Option to pay off total loan (based on property value at time) at any time and own outright. Minimum repayment is 10% of market value.

Cons

  • New build property only – can be more expensive than pre-owned, have to rely on many intermediaries e.g. builder, help to buy adminisitrators, lender, selling agent.
  • Loose up to 20% future property price rises.
  • Cannot make any alterations to the property without permission from H2B scheme managers.
  • Sale price must acceptable to scheme provider (selling under value to family member etc not allowed).
  • Not available if there is adverse credit.
  • Help to Buy- Mortgage guarantee.

The difference to Equity Loan scheme is that both new and old properties can be bought under this scheme. Available for purchase price up to £600,000 for both FTB and home movers. You cannot own another residential property or allowed to sub-let the property.
How it works

  • You contribute: 5% of purchase price.
  • Governmant provides a guaranteed to the lender up to 20% of value, allowing the lender to lend up to 80 – 95% of value.
  • Offset or guarantor mortgages not allowed..
  • Only available through lenders participating in the H2B mortgage guarantor scheme..

Pros

  • Minimal deposit (5%) to enter the property ladder.
  • You own all of the property and will benefit from all of the gain in future house price.
  • Both capital and interest paid from start.
  • Available for both new build and older properties.

Cons

  • Rates are higher than for similar residential mortgages.
  • Not available as guarantor mortgages, maximum lending is still limited to income earned.
  • Property cannot be let and you are not allowed to own any other property at same time.
  • Not available if there is adverse credit i.e. over 3 month’s missed payment in the last 3 years, CCJs over £500 or bankruptcy within last three years.

 

  • Help to Buy – Mortgage guarantee.

Call us on 020 87617771 to discuss your options.
Use our Lender comparison service to find the best deal.