Mortgages

 

First Time Buyer Mortgages

If you are a First Time Buyer then the mortgage market may seem like a different world and a daunting prospect to investigate.

At Grovelawn Financial we offer all the advice needed to understand the whole process of buying your first home. Not only do you need to be aware of the different mortgage types available which include Fixed, Capped, Discounted, Tracker and Variable rates but also the other costs involved which will include legal costs, stamp duty (depending on the value and location of your property).

Our specialist mortgage advisors at Grovelawn Financial will be happy to guide you through the entire process and then once they have determined what your requirements are they will give you quotes on the most suitable products that would be available to you.

Should you then decide to proceed further we are able to get a decision in principle from the lender to see if they will lend you the money for the mortgage subject to their underwriting and condition of the property. To get a decision in principle will require the lender to undertake a credit check and we would only suggest this once you were happy with the product already discussed with our advisor.

There are many mortgages available to First Time Buyers and you can borrow up to 90% of the property value and with some lenders income multiples can be as much as 4x your single or joint earnings. But interest rates are generally higher the greater the loan to value (LTV) and the greater the income stretch so if you are able to save for a deposit before embarking on a house purchase the interest rates should be a little lower which would in turn mean your monthly mortgage payments would be lower too.

Please note that some lenders may impose a Higher Lending Charge. This is the lender's way of rating the higher risk present. A Higher Lending Charge is a premium charged by the lender in order to indemnify themselves — not the borrower — against any financial shortfall that may occur in the event of repossesing the property.

There are two options on repaying your mortgage; interest only and repayment methods.

  1. Interest only means that you only pay the interest element of the mortgage so for example; if you borrow £100,000, you would still owe £100,000 at the end of the mortgage term. Most lenders will require you to have an investment vehicle behind the loan — such as an ISA — the money generated would be targeted to repay your mortgage amount at the end of the term. This is not guaranteed as it depends on the returns achieved by your chosen investment. (Please note we do not advise on investments and you should seek expert advice.)
  2. The repayment method which means that every month you pay the interest element and also a part of the capital too, so if you took a mortgage out for £100,000 over 25 years, in 25 years time at the end of the mortgage term you would have cleared your mortgage balance completely.

So for help and advice regarding your First Time Purchase call us and one of our mortgage advisors will be happy to guide you through the whole First Time Buyer Mortgage process.

Your property may be repossessed if you do not keep up repayments on your mortgage.

For more information on how we are paid for mortgages please click here.

Grovelawn Financial Services, 3b Restormel Industrial Estate, Liddicoat Road, Lostwithial PL22 0HD — T: 0845 458 2633