FAQs For First Time Buyers

In today’s blog post we will be sharing FAQs for first time buyers. If this is you, use this blog post as a guide whenever you need your questions answered.

What is a mortgage?

A mortgage is a loan obtained to purchase real estate or land. On average, the time frame for a mortgage is 25 years.

How much deposit will I need to buy my first home?

You need at least 5% of the cost of the property you want to purchase. However, it is recommended to save more than this for other additional costs.

Is it easier to buy my first property with someone else?

Buying a property with someone else or a group of friends is a good way to get onto the property ladder. Not only will it be cheaper, but you will be able to get a higher mortgage depending on each of your salaries. When you buy a property on your own, it might take you longer to save for a deposit.

What should I ask myself before buying a home?

As a first-time buyer you should ask yourself:

• What type of property will best suit your needs?
• What can you afford?
• Are you ready to buy a property?
• Is my credit score high enough to purchase a property?
• How long do I plan to live at this property?
• Do I have any goals with this property in the future e.g. renting, serviced accommodation, etc.

What is stamp duty?

Stamp duty is tax that you pay when you purchase a property. However, it’s best to check with your mortgage adviser as not everyone will need to pay this.

How can I find a mortgage?

You can apply for a mortgage from a bank of building society. However, we recommend using a mortgage advisor to help you find a mortgage that is best for you.

What does the term ‘exchange of contracts’ mean?

An exchange of contracts means when a house sale or purchase is legally binded.

What questions should I ask when viewing a property?

• How long has the property been on the market?
• Why are the owners selling the property?
• How old is the property?
• Are there any issues with the boiler?
• How are the neighbours?
• What is the area like? Have there been any issues?
• How many owners has the property had?

Should I buy a freehold or leasehold property?

Most often than not it’s better to buy a freehold property as it means that you own the property and land it is on. However, if you buy a flat, it’ll be a leasehold property as you won’t own the land it’s on.

What is ground rent?

Ground rent is an additional fee charged to cover the cost of the land your property is built on. This is commonly charged if you purchase a flat.

What is service charge?

Service charge is a charge that covers the buildings insurance, maintenance, repairs, gardening, communal services, cleaning, etc.

What Help to Buy Schemes are there?

The Help to Buy Equity scheme was put into place in December 2020 for first time buyers and ends in March 2023. With this loan, the government gives new homeowners the ability to buy a property with 5% deposit.

How long will it take to complete my purchase?

This is a difficult question to answer as every purchase is different. If the seller has left the property and you have a mortgage in place, then exchange of contracts and completion can happen in a timely manner. However, if the seller has not vacated the property the exchange of contracts and completion can be timely.

Refer to these FAQs whenever you need help on your property journey. Alternatively, you can network and ask questions in our community Facebook group.

Before you go …

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