Homes Sell Buy :: First Time Buying a Home
First Time Buying a Home:
Finance Tips for Buying a Home for the First Time
The first time buying a home can be a pretty nerve-wracking and trying time. As if it wasn’t bad enough making the decision to fly the nest and leave your parents’ home or break away from renting property and finally put down some roots in property you own, you have to finance it all somehow. That first step up on to the property ladder can be a daunting prospect as it means dealing with estate agents, mortgage lenders and lawyers, probably all for the first time. However, you shouldn’t be concerned as there are a few ways you can make the first time buying a home much easier.
Mortgages for the First Time Buyer
For pretty much every person’s first time buying a home it is securing an appropriate mortgage which you can afford which is most difficult. Before you attempt to get a mortgage, you should really do some thinking here and make a budget. What kind of monthly mortgage repayments can you afford to make? This will determine the size of the mortgage you can secure and consequently, how much you can afford to pay for a house. It is normal for the first time buying a home to be offered a mortgage for three times your salary if you are a single person, or if you are trying to get a first time mortgage as a couple, then it is usual to be offered a mortgage for two and a half times your combined salaries.
However just because this sort of a mortgage is offered to you it does not necessarily mean that you should take out a mortgage for that much. Try to budget sensibly, and you would be well advised to pay out no more than thirty-five percent of your regular monthly income in mortgage repayments.
All or Nothing?
If this is your first time buying a home you may well be offered a hundred percent mortgage which means that you will not need to make any down payment at all on the property which you wish to buy. However, that may not be such a good idea. It is better to plan ahead for your first time buying a home and save some money regularly for a few years beforehand; as well as getting you into good saving habits this will give you a deposit which you can pay on your first property. This is a good thing to do for several reasons: because it will lower your monthly mortgage repayments; the bigger your deposit, the better mortgage terms can be negotiated, such as lower interest rates and even a few months without any repayments at all: that should be a great help as you need to spend money to decorate your new house on a first time buying a home. You will also increase your financial security by making a deposit on your first time buying a home because, should the property market slump, you are less likely to be in a state of negative equity whereby your property is worth less than you are paying into it.
Reduce Your Costs
Something that people often forget on their first time buying a home is the money they will need to pay out to estate agents and lawyers. You need to shop around and see if you can find a mortgage lender who will cover your legal fees, which will give you a great saving.
The first time buying a home should be a fun and exciting time so you need to avoid the common pitfalls by finding the right mortgage for you.
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