When buying a home most of us need to borrow money. This loan is secured on the property you are buying and should you fail to stick to the terms agreed it’s possible that the mortgage lender will take possession and then sell the property to pay off what is owed.
First-time buyers are new to the housing market and as such it’s generally recognised that they need some help either with raising a deposit or by way of a reduced rate of interest in the first few months or years.
The UK government offer various schemes including a help to buy scheme aimed at those buying their first home or a new home as well as various savings schemes including the Help to Buy ISA Scheme.
First Time Buyer Mortgages usually fall into two categories, namely;
- The repayment mortgage. This is usually a loan taken over say 25 years and repaid (with interest) in equal payments month-on-month. As the sum owed reduces the interest charged slowly reduces meaning that whilst the first few years will see little reduction in the outstanding sum owed, the last 10 years will see large amounts of capital being repaid. At the end of the loan period you will have repaid your loan and own your home outright.
- The Interest-Only Mortgage. This type of loan is, as the name suggests, a loan that you don’t repay until the end of your mortgage term. This reduces your monthly repayment but, at the end of the loan, you will need to repay the loan either from savings, a pension lump sum or even through the sale of your home! The advantage of low initial repayments should be balanced against the fact that you pay more interest over the term of the mortgage as the average outstanding debt remains much higher.
Many mortgage companies and lenders offer first-time buyers incentives and assistance including reduced interest rates and low arrangement fees. Contact Mortgage Required to see how we can best serve your needs today on 01628 507477.
Related articles:
Download our Free First Time Buyers Guide
Recent posts
Decorating Tips for Selling Your Property
14 days ago
Selling up? It’s important to make your house as appealing as possible to potential buyers. Good decorating can help with first impressions, and increase the perceived value of your property.
20 Budget-Friendly Activities
25 Aug 2023
With the cost of living affecting so many of us, we have made a list of budget-friendly activities and ideas for you.
Moving and Packing Tips for a Stress-Free Move
21 Jul 2023
Moving soon? It's never too early to get organised! Be prepared and avoid unwanted stress by checking out our list of tips to get you ready for moving day.
What is the UK Inflation Rate?
27 Jun 2023
Inflation simply put, is the increase in the price of something over time. The Office for National Statistics (ONS) tracks the prices of hundreds of everyday items and these items are updated to reflect shopping trends.
Debt Consolidation into a Mortgage
20 Jun 2023
We are often asked if it's good advice to consolidate “unsecured” debt (credit cards and loans etc) into your mortgage, the answer is, sometimes.
Parking Rules Explained
16 Jun 2023
When you’re looking to buy a home, and you own a car, you ideally want to know the rules on parking in the area. Parking rules can be confusing, even for the most experienced of drivers! This is why we have written this blog to help you.
Sources of Deposit to Buy a Property
6 Jun 2023
There are several potential sources you can consider when it comes to getting together a deposit to buy a property. Providing proof of the source of your deposit is a key requirement in the application process and will need to be given to both the lender and the solicitor.
More information
Trusted by
