First Time Buyer Tips

8th Feb 2023

In this first-time buyer guide, we share our thoughts on buying your first home. A few helpful tips and recommendations from us will give you a breadth of knowledge and insight prior to you starting this exciting journey to buy your first home.

You need to establish how much cash you can put towards the cost of a new home. Generally, the bigger your deposit, the better mortgage rates you will be offered, and the lower your monthly mortgage payments will be.

Unless you are in a position to buy a property with cash, you are going to need a mortgage. Simply put, a mortgage is a loan from a bank or building society against a property. The borrower has to pay back the loan in addition to accrued interest.

We recommend speaking to a specialist Mortgage Advisor to discuss what you can afford which will also give you a better chance of securing your dream home. There are a few simple things that you can do yourself in preparation to meeting your mortgage advisor. Andrew Milnes, Business Principle of Mortgage Advice Bureau says, “It’s worth checking your credit score through Equifax or/and Experian to check any debts and whether your credit score is at a suitable level.

“Make sure you think about any credit cards that may not have been paid off as these will impact your mortgage options. It is also vital that you make sure you are registered on the electoral roll as this information helps lenders confirm who you are and where you live thus improving your credit score.

“You will also need to provide a full audit trail of deposit cash, make sure that you have any documentation ready that will provide evidence of where the cash has come from.”

Other costs
You need to bear in mind the other costs associated with buying a home. The lender will likely charge you for entering into a mortgage agreement, known as an arrangement fee. The lender may also ask you to cover the cost of assessing the value of the property you intend to purchase, known as the valuation fee.

It is also highly advisable to appoint a property solicitor – known as a conveyancer – to manage the legal side of the purchase. They will draw up a contract, deal with Land Registry and manage Stamp Duty charges.

Back in July, the government announced stamp duty exemptions on all properties valued up-to £500,000. Andrew adds, “If you’re wanting to take advantage of the stamp duty holiday ending on 31st March, you need to be proactive. Discuss your requirements with an advisor who can do all your budgeting and affordability checks upfront and be prepared to share all your documents with them.”

Other costs to consider include the hire of a removal firm and redecoration.

When you are looking for your first home, make sure you consider the location you want to live in. It needs to be practical for travel and work. We recommend taking a look around different areas so you can decide where you’d like to be if it’s somewhere new. You also need to bear in mind that the best locations carry a premium price tag. What appears to be a cheaper property in a less popular location may be difficult to sell in the future.

The property itself
The type and age of your property will determine the amount of upkeep and maintenance. Older properties tend to need more work, but allows you to make it into a home more suited to you. It is worth considering what lifestyle choices are going to be made during your time at the house, whether you will be expanding your family or getting any pets is worth considering.

When you go to view a property make sure you take into account the length of time it has been on the market as when you come to sell it on you want to make sure you can make a sale in a reasonable amount of time.

Making an offer
When you come to make an offer, don’t be discouraged if your first offer is rejected, it sometimes takes a long time with plenty of negotiation before the right price is agreed. When making an offer you may need to provide proof that, as a first-time home buyer, you can secure a mortgage, this is where an agreement in principle comes in handy. Once your offer has been accepted, you will need to apply for your mortgage formally.

Choosing solicitors
Once you have found your dream home, made the offer and had it accepted, you are now in the position to instruct a solicitor. We can recommend you a number of high-quality and reputable solicitors for you. 

Exchange contracts and complete 
Your solicitor will start all the legal and administrative work associated with transferring the property. This includes arranging Stamp Duty, contacting Land Registry, transferring money during the sale, and acting as a general intermediary between you, the lender and the seller.

You will agree the terms of the sale – including who you are, how much the house or flat is transacting for, and a completion date, when you can move into your new home.

Your mortgage will now be approved. Your lender may require you to insure the property as part of the approval process.

The contracts will then be exchanged and you are locked into a legally binding deal to buy the house or flat. At this point, you will need to put down your deposit.

On completion day, you will be able to pick up the keys from the estate agent or seller.