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First Time Buyer Mortgages FAQ
What is a first time buyer mortgage?
A first time buyer mortgage is a mortgage specifically for buyers who are not existing home owners.
Are first time buyer mortgages more expensive?
Not necessarily. The rate you'll pay will depend largely on how much of a deposit you have. The fact that you're a first time buyer has no impact. In fact, first time buyer mortgages tend to come with incentives such as cashback or free legal services.
What kind of deposit do I need for a first time buyer mortgage?
First time buyer mortgages are available at a range of loan to values (LTVs) - the ratio of the loan amount needed compared to the cost of the property. The larger deposit you have the lower the LTV. Lower LTV mortgages tend to have cheaper rates.
What fees will I pay?
You could face an arrangement fee, product fee, valuation fee and legal fees although not all fees apply to all products.
What criteria will I have to meet to get a first time buyer mortgage?
You will have to meet your lender's affordability criteria. The lender will want to know you can afford to repay the loan and each lender has its own means of assessing affordability. You'll also need to adhere to the lender's standard criteria, including being within its age limit and having a good credit score.
What are the benefits of first time buyer mortgages?
Mortgages aimed specifically at first time buyers tend to feature incentives such as money towards legal fees, cashback or low fees.
What are the downsides?
There aren't any downsides specific to first time buyer mortgages, but as a first time buyer it's important to bear in mind all of the costs involved in taking out a mortgage and ensure you are able to afford the monthly repayments.
How can I improve my chances of getting a first time buyer mortgage?
Your lender will want to make sure you can afford to repay the mortgage so keep your finances in order, check your credit score is good (and take steps to improve it if need be) and where possible reduce your outgoings. Also, remember the bigger your deposit the better the rates available to you so save as much as you can before buying.
How can I compare first time buyer mortgages?
You can compare first time buyer mortgages using Know Your Money's comprehensive comparison tables which allow you to sort products by fees, rates and overall cost.