For the majority of us buying your first home is an important milestone in our lives, making the decision to become a homeowner is an exciting time but you should know all the details before making any big decisions. Mortgages are available in lots of different options from fixed rate mortgages to tracker mortgages our team will guide you through the process, and we’ve created a guide to help you choose the right mortgage for you.
5 step guide in choosing the right mortgage for you
1) Save the largest deposit you can
Before choosing a mortgage plan you need to save the largest deposit you can – the larger your deposit amount is the cheaper your mortgage will be. The minimum deposit for a house is usually 5% of the overall cost. For example, if the house you’re hoping to purchase is £150,000 your deposit minimum will be £7,500. Read our tips and tricks to adopt when saving for a deposit.
2) Save for additional costs too
Everyone talks about saving for a deposit but remember to save your money for the mortgage and buying process too! You need to budget for mortgage arrangement fees, surveyor’s fees, conveyancing fees, stamp duty and removal costs that are available in one simple figure in our sales packages. You can never be too prepared!
3) Establish what you can afford with your lender
When you’re buying your first home and choosing a mortgage it’s easy to get carried away with different options, but always remain realistic during this process as you don’t want to choose a mortgage that you can’t afford to pay back. On average property buyers are allowed to borrow around four times their income, establish what you can afford to pay monthly before signing any binding documents.
4) Popular mortgage options
The two most popular mortgages are variable rate and fixed rate. A fixed rate mortgage requires a monthly payment that is the same each month typically over two to five years, with a set interest rate. A variable rate mortgage can change with interest rates, so your monthly repayments can increase or decrease depending on the current interest rate of the time. But lots of lenders offer multiple different mortgage options, do your research to find the right mortgage for you.
5) Do your research
When it comes to choosing a mortgage, research is key. By this stage you have budgeted for the buying process, saved for a deposit, and are aware of the different mortgage options that are out there but now you need to decide which one is right for you. Talk to various lenders, friends and family members, they will help you get a clear understanding of the mortgage process, but if you’re still unsure read our news posts for advice and guidance from our experts.