First Time Buyers
At JB Mortgages we offer the personal attention required to find a perfect fit at the lowest interest rates available for your circumstances.
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If you’re a first-time homebuyer looking for a mortgage, our team of mortgage of mortgage advisors is here to help. We can assist you in finding the perfect mortgage for your first house.
We have put together the below first time buyer guide, which can help answer frequently asked questions:
What is a ‘First Time Buyer’?
You are a first time buyers if you are looking to purchase your first property and have never owned a property before.
You do not qualify for a first time buyer mortgage if you have previously owned a property, or if you have inherited property from a family member. Similarly, if you own a house or flat but your partner does not, and you want to purchase somewhere together, you will not be eligible for first time buyer mortgage schemes.
How much deposit will I need?
You will need a minimum deposit of 5% of the purchase price, which would mean you would need a 95% loan to value (LTV) mortgage. As a 5% deposit is generally the minimum deposit needed, the amount of mortgage products available on the market will be limited.
The larger deposit you have, the wider your choice of mortgage product will be. You’ll also benefit from lower interest rates as mortgage lenders consider first time buyers with bigger deposits as lower risk than those with only a small deposit, so if you proceed with a 10%, 15% or 20% deposit, you will have access to more mortgages on cheaper interest rates.
Mortgage lenders can accept your deposit from personal savings or via a gift deposit from a family member or friend.
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Everyone’s different. You might be self-employed. You might have some credit history issues – whatever your situation, we will find the most suitable product available to you from across the whole market.
How much can I borrow?
The maximum mortgage amount you can borrow will vary from mortgage lender to mortgage lender.
Most mortgage lenders will allow you to borrow up to 4.5 x your annual income – for example if you and your partner earn £25,000 each (£50,000 in total), you might be able to borrow £225,000 subject to meeting the mortgage lenders affordability criteria.
Mortgage lenders will need to know about all your outgoings, such as:
- Credit card balances
- Unsecured loan balances & monthly payments
- Car finance balances & monthly payments
- Student loan payments
- Childcare costs
- School fees
Some banks or building societies will allow you to borrow up to 6 x your annual income. These higher income multiples would mainly apply to first time buyers with larger incomes and larger deposits.