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Tips For First-Time Homebuyers

by Jim ONeil on April 30, 2011

in Mortgages

A home represents the largest purchase made within a lifetime so it makes sense that the home-buying process is not easy. These days, things are even more difficult due to restricted lending courtesy of
the credit crunch.First-time homebuyers face limited options when it comes to mortgages. Anyone who is purchasing a first home should follow some guidelines designed to streamline the process.

Post-credit crunch, 100 percent loans have disappeared and deposits over ten percent are now required. With the January 2011 average first-time buyer mortgage being £100,000, this means some saving will be required.

Family and friends can pool money with first-time buyers and make the purchase together. Government programs like cash incentives and low-cost ownership are also available, as is shared ownership.

Homebuyers should consider giving up certain factors or stretching the budget to purchase a two-bedroom home. There are plenty of people who cannot afford a home and are interested in renting a room. This assistance with the mortgage payment can be very helpful.

Consumers often figure they can afford a mortgage but do not consider additional costs like ground rent, repairs, council tax, utilities, and building and contents insurance.

When reviewing mortgage setup costs like valuation and arrangement, a long-term perspective is necessary. In addition, realize that the least expensive headline rate does not always equate to the best deal over the entire benefit period or term.

Consider purchasing a home with assets that can be leveraged like a driveway or garage for commuters or shed for others to store items.

First-time homebuyers can find loans cheapest when they have an excellent credit score. Cost of home ownership should be calculated in advance of signing on the dotted line.

A mortgage adviser can help first-time buyers estimate costs, plan a budget, and prepare themselves for the experience of home ownership.


I have recently offered £10K under the asking price of a property I have my eye on, and have been informed that it's being seriously considered. In reality your offer will be far too low, and likely to be refused. Do you have the option to get a joint mortgage with a relative or close friend?

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