# Mortgage for a first time buyer



## Andy_RX8 (Jun 6, 2008)

Looking for advice/help its all a bit confusing! 

Does anyone know who is the best bank to deal with at the moment for first time buyers?

What type of mortgage would you reccomend to a 1st time buyer (fixed,variable,tracker etc etc)?

If a house is priced at 118k and has been for roughly 6 months+ how much of an offer would you put in considering the current climate? 

A bit a bout me:

1st time buyer
Looking at a house priced £118,000
I have a £15,000 Deposit

Thanks in advance.

Any help at all appreciated.


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## Mark M (Nov 29, 2006)

I would recommend a fixed rate for 3 years, as you will know what you are paying, and will be able to manage the money easier.

The market is starting to go up a touch, well up here anyways.

Normally your first offer will be refused, unless you can come to an agreement with the seller, then put in one bid and they accept.

Obviously, the least amount of offers benefits you.

I recently bought mine for 5k under the asking in a desirable location, and the house had been on the market for a month, with a bit of interest.

I would maybe go in at 110k, and take it from there?


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## Andy_RX8 (Jun 6, 2008)

Thanks mate.

Advice is always welcomed.


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## Stumper (Apr 5, 2009)

We're just coming to the end of sorting out our first mortgage and it was interesting to say the least!

I'd recommend using a broker as they'll advise you of the best mortgage for your circumstances. Ours was exceptionally helpful.

One thing that I noticed is that there aren't many good deals about for FTB's unless you've got a high % deposit, usually over 40%!

As for prices, I'd start at £110,000 and see what happens!


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## andypp (Aug 21, 2009)

*Mortgage Advice*

Hi if you offer say £115.000 for property and have a £15k deposit that means you are only putting down 10% as you know ,or what we call LTV (loan to value ) most lenders will want a bigger deposit in this climate than 10% eg 15% to 20%of the value of property (and remember they give you 80% or 85% of what price the house has surveyed at not the price you have to paid (eg offers over) !

If you go to a broker ask them if are they whole of market (what means they will search the whole of the market price for you) (but watch out for the fees they might charge you ).

If you need any more advice let me know !

This is my first post on fourm (have not checked rules yet re leaving my contact no etc etc

Regards Andy


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## sayloday (Oct 5, 2008)

Might seem obivious to most, but don't forget to set some money aside for the Solicitors Fees, searches and surveyors report.


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## Glossmax (May 9, 2007)

Wouldn't £11,500 be 10% Andypp?

A good broker will sort you out, try and get a recommendation though.

Personally I would sound out the estate agent as too what price to offer as they will have an idea what the seller is likely to accept. Also check out similar priced houses as a way of working out whether it is good value or not.


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## andypp (Aug 21, 2009)

Soz about the multiplcation too late at night ! Well spotted


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## andypp (Aug 21, 2009)

Ps i use several sites to check house prices in that area/street (as above post sugg )

Nethouse prices is one of them (and put in the post code then hit search ) Good site you can also check what you next door neighbour paid for his house 


Regards Andrew


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## mouthyman (May 1, 2006)

andypp said:


> Ps i use several sites to check house prices in that area/street (as above post sugg )
> 
> Nethouse prices is one of them (and put in the post code then hit search ) Good site you can also check what you next door neighbour paid for his house
> 
> Regards Andrew


that is a good site, ive just had a quick look at our postcode, one of our neighbours who owns a smaller semi detached house bought it in 1999 for £95k and sold it last year for £214k:doublesho


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## APK (Oct 6, 2008)

andypp said:


> Ps i use several sites to check house prices in that area/street (as above post sugg )
> 
> Nethouse prices is one of them (and put in the post code then hit search ) Good site you can also check what you next door neighbour paid for his house
> 
> Regards Andrew


Good suggestion, I use www.ourproperty.co.uk , with regards to the "best" mortgage, it is more a case of what you can get at the moment, you should try to get a 15% deposit, even if you have to borrow it elsewhere, as 90% deals are horrendous at the moment (7%+) whereas 85% is less than 6%. beacause rates are so high at the moment for high ltv's you would probably do best getting a short term deal, as when it matures lenders hopefully will be more competitive, if not the lenders standard variable rate at that time will likely be lower anyway.

As previous posters have suggested, get yourself a good "whole of market independent" broker, you should be able to find one who doesn't charge fees.


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## Andy_RX8 (Jun 6, 2008)

Thanks for all the advice folks.

Very helpfull.


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## andypp (Aug 21, 2009)

Our property is another site you might want to try ,you might need to register for this one !

Thats all most estate agents do to get a rough price of what property might cost/achive for clients 

Regards Andypp


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## willrob60 (Aug 7, 2009)

a friend of mine is looking at a flat 100k with 10k deposit, and was told he would need at least 40k deposit as just started work and has never had credit. or he could use his folks house as guaratee.
Advice was to try again in 6 months after boosting his credit rating with credit cards


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## mccalia1 (Mar 1, 2008)

Try giving A3 Financial Services a call on 01730 893711

Ask for Kevin Minshull. I've used Kevin for my mortgage and various buy to lets and has to date managed to get some great deals.


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## APK (Oct 6, 2008)

willrob60 said:


> a friend of mine is looking at a flat 100k with 10k deposit, and was told he would need at least 40k deposit as just started work and has never had credit. or he could use his folks house as guaratee.
> Advice was to try again in 6 months after boosting his credit rating with credit cards


90% mortgages are available, but generally the rates are horrendous, also lenders are being very picky now on what they view as "high risk" i.e. high ltv mortgages, as such the requirements for credit scoring are nigh on impossible. Important things for your friend are: to ensure they are on the voters roll, if not it will probably decline straight away, if they don't have a credit card, get one and use it (ensure they have a direct debit to automatically pay the bill in full monthly) this will build up their credit rating by prooving they can handle credit - if they don't have any credit, how can they proove to the lender they are a good risk?

It is essential that they do not incur any missed payments on anything at the moment, for a high loan to value mortgage (75%+) credit history must be squeaky clean.


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## mba (Jun 17, 2006)

I have just taken a mortgage out as a first time buyer and found HSBC to be the best for me

House = £125,000
Deposit = £12,500 (LTV @ 90%)
Mortgage = £112,500
Term = 25 Years

Using the HSBC 2 year Discounted Variable rate of *3.89%* this gives me a monthly payment of £580 (not including insurances etc....) - *£1199 application fee though!*

There was a NatWest 90% LTV NatWest TRacker @ 4.69% with *£0 fee* - which would have been £630 per month.

The fixed rate deals were 5.99% with a monthly pay of £750!!

I went for the HSBC mortgage really gambling on that the BAnk of England will not raise their base rate to such a level where i will be out of pocket in 2 years.


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## matt strike (Jan 2, 2009)

All of the advice to get a whole of market adviser is good, however, many of the high street lenders (HSBC, Natwest especially) do much better deals for direct applications (not through an adviser). It's getting harder and harder to find someone who doesn't charge fees, it's been a tough year for most advisers (approx 50% have quit), and most of the good ones do charge because they are worth paying. That said, a few hundred pounds seems reasonable to me, not 2-3% as I sometimes see quoted.

I am an adviser and I'd go for a fix, three years +. There's no way I'd bank on the base rate not rising within two years, and I expect it will rise by quite a bit.

I would also add, even if you do go direct to a bank or building society make sure you find a good adviser to do your insurances. For me there's just too many loopholes, pitfalls and small print to do it yourself, and cheapest is rarely best. Insurance is too important to skimp on.

As for making an offer, you're a first time buyer which is always appealing to people so go in low, the worst that can happen is they say no. 10-15% below asking price is normally a good if slightly cheeky starting point.

Good luck.


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## APK (Oct 6, 2008)

Matt,

Sadly I have to agree with you about direct deals, HSBC and RBS being the main ones, however, particularly HSBC have very high criteria, and appalling service, I also am an advisor, and actually pick up a lot of business from people who have gone to HSBC first and after 6 weeks have got nowhere.

I tend to disagree with you about rates though, I feel short term fixed rates are too high, rates will remain low for a year or two until the economy improves and for most people the savings by going for a short term tracker are worth the risk (hopefully in 2 years time lenders will have sorted themselves out, and start competing for business dropping their margins closer to weher they were a year or so ago)

Got to agree with you about insurances, too much to lose by not getting the correct policy, and we can always smash the prices the lenders quote as they are tied to one provider normally(doing a policy this week for a client, Abbey quoted £78pm I can do Aviva £42pm exactly the same cover!)

As for making an offer, really depends where you are, I'm in Essex, and properties are in short supply, with decent properties selling within a week or so, as such, you would be lucky to get 5% off, but start at 10% if you are in a strong position and expect to settle somewhere closer.

Advisor fees are a minefield, I don't charge, I know a lot do now, but some of the fees charged are too greedy, yes I would like to charge 1% a case, then I could afford to spend more money and support the economy! but I am not greedy, if I can make a decent living then I am happy, most of my business is from referrals, so obviously my customers are happy as well.


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## mba (Jun 17, 2006)

APK said:


> I tend to disagree with you about rates though, I feel short term fixed rates are too high, rates will remain low for a year or two until the economy improves and for most people the savings by going for a short term tracker are worth the risk (hopefully in 2 years time lenders will have sorted themselves out, and start competing for business dropping their margins closer to weher they were a year or so ago)


If my tracker rate rose 1% it would be an extra £58 a month

Tracker = £580
Fixed = £750

Difference = £170 per month!! (over the 2 years £4080!)

I am taking a gamble that they will not raise the base rate by 1% at a time so i will start to be out of pocket if the base rate raises 3% in 2 years but it will be offset by my short term gains.


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## Gruffs (Dec 10, 2007)

Hi all.

Rather than open a new thread, i thought i would continue this one.

My fiancee and i are looking to buy our first property.

We earn £52K between us and have a small deposit of about £5K. 

Now it seems like we can afford to make the repayments on £120K pretty comfortably but our deposit size is hindering us. By the time we have saved the deposit, the interest rates will be higher and our monthly payments more.

We do have the option of using the FTBI as my fiancee is a teacher but i believe this is only on new builds (i.e. with the developer). My fiancee can't drive so we need to live where she works. Trouble is, i'm not aware of any new builds in our town. So I guess my questions are;

What is the likelyhood of us being approved a mortgage?

For those in the know, can the FTBI be applied to an older property?

Thanks in advance.


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## mba (Jun 17, 2006)

Gruff - is there anyway yours or her parents can release some equity in their houses?

Personal loan from the bank? £7,000 over 5 years is £143 per month paying back £8,591

Now i know thats not the ideal way to raise cash and will be taken into account during the mortgage application but with a combined salary of £52,000 i think you could afford it?


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## APK (Oct 6, 2008)

Personally I would go further, to get a decent rate, you need to have at least 15% deposit, consider borrowing more (Tesco's are about the cheapest) you will probably find most of the cost will be offset by a cheaper mortgage rate. On your incomes, if you are looking to borrow £120k then you will have no problem, even taking the loan payments into account.
You may wish to apply for a "car loan" as they wouldn't lend as a deposit on a house.


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## Gruffs (Dec 10, 2007)

Thanks guys. It really does seem rediculous that despite our income and modest housing aspirations (for now). We cannot get a mortgage.

It seems that we are wanted on the housing ladder but only at a point that we cannot take advantage of the market and 'trade up'. 

Meanwhile. Tommy scaghead and his wife, pregnant with their fifth child is given a 4 bedroom house because they are 'disadvantaged'.


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## Stumper (Apr 5, 2009)

We've just gone through the FTB thing, hopefully we'll be completing in about three weeks and I know how you feel.

We've wanted to buy for a few years and between us earn enough to comfortably pay our mortgage. Our current rent is dearer than our mortgage payments will be on a £145k mortgage but due to a lack of deposit it held us back. Basically we've had to scrimp, save and work stupid amounts of O/T at work to get he deposit together otherwise we would've been stuffed.

The most irritating thing is that when I'm at work every day, driving round in my Ambulance and being used as a taxi by the dregs of society, these people are all living for next to nothing in council houses with pretty much everything paid for, sitting on their lazy backsides watching Jeremy Kyle on their 48" Plasma TV's while the likes of us are having to work our nuts off to save for a house and support them at the same time......Rant Over....

Try speaking to your local council about Keyworker loans, your OH should be eligible being a teacher. A couple of friends of mine used this scheme to buy their first homes.

http://www.direct.gov.uk/en/HomeAndCommunity/BuyingAndSellingYourHome/HomeBuyingSchemes/DG_4001345


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## Gruffs (Dec 10, 2007)

graeme_t said:


> We've just gone through the FTB thing, hopefully we'll be completing in about three weeks and I know how you feel.
> 
> We've wanted to buy for a few years and between us earn enough to comfortably pay our mortgage. Our current rent is dearer than our mortgage payments will be on a £145k mortgage but due to a lack of deposit it held us back. Basically we've had to scrimp, save and work stupid amounts of O/T at work to get he deposit together otherwise we would've been stuffed.
> 
> ...


Thanks but all the government schemes are based around new build homes (helps the construction industry doesn't it). We don't have any new builds in our town (at all). We need to live close to her school as she doesn't drive (epilepsy). We have even tried to get help with transport costs because of her recognised disability but i earn too much :wall::wall::wall::wall:

I don't know why i ****ing bothered. It's really getting on my nips right now.

TBH, we don't want to live crammed up against my neighbour with no garden and no garage. The only way we would buy a new build is if the govt. helped us to do so. We could then sell it on. But, they are not going to so i'll save my money and buy an older property that will be worth more when the new builds are falling down in 30 years time.

The homebuy schemes also get very expensive after about 5 years so you need to know when to get out. That then relys on people who want to buy smaller houses being able to get a mortgage. :wall::wall:


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## Stumper (Apr 5, 2009)

I'm not sure of the in's and outs of it but the Guys I work with got the Keyworker loan which you could use to buy either any property, not just newbuilds. I'll see if I can find out some more details from some of colleagues for you.

http://www.sovereign.org.uk/sovereign/pdfs/Key_Worker_Equity_Loans.pdf

I'm not sure what area you're in but the local councils usually have similar schemes running.


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