How do you get your first mortgage?
If you're preparing to buy your first home, then congratulations on reaching a huge personal milestone.
Buying a home is exciting for anyone, but all the more so for first time buyers as they get their feet on the property ladder and look forward to having a place they can really call their own.
But alongside all that excitement, it's natural to be nervous about the responsibilities of home ownership and getting a mortgage for the first time.
So what are the main things you need to think about?
You’ll need to provide a deposit to get your first mortgage. This will depend on the mortgage deal you choose, but lenders will typically require a minimum deposit of 5%. The larger the deposit, the more competitive the options that will be available to you.
How do you calculate the deposit that you’ll need?
Start by aiming for 10% of the value of a typical property that you expect to be able to afford, or alternatively find out how much you could afford by using Trussle’s online affordability calculator.
There are also some schemes that can help first time buyers (we’ve listed some of these further down), so it makes sense to be as well informed as possible.
The legal requirements
You’ll need to appoint a licensed conveyancer or solicitor to carry out the legal aspects of the home purchase, such as arranging the contract. It’s important that you do this after you’ve received a mortgage recommendation from your broker or lender, as they need to be specifically approved on the chosen mortgage lender’s panel.
You’ll need to buy home insurance from the moment that your new property becomes yours.
You may have had contents insurance in the past, but now you’ll need buildings insurance in order to protect the home itself. You can get home insurance from reputable mortgage brokers who can access the most competitive deals.
Your mortgage broker will recommend a suitable mortgage deal that matches the amount of deposit you can afford to pay upfront. They should also inform you of deals you might be able to qualify for should you be able to contribute a slightly larger deposit. If you secure a Mortgage in Principle from Trussle, we’ll show you how much you could afford to borrow based on your income, outgoings, financial commitments, and the amount you’ve saved up for a deposit.
One you’ve exchanged on your home, you’ll transfer the deposit via your solicitor, who will liaise with the seller and lender. After completion, you’ll make an initial mortgage payment and then subsequent payments on the dates advised by the lender. Your first payment may be slightly higher than your normal payment depending on when you complete.
The application process
When you apply for a mortgage, you’ll need to provide information about your finances and the property to your broker or lender. It helps to have your paperwork organised to make this process as smooth as possible.
Examples of the items that you may need to provide include:
- Proof of ID
- Proof of address
- Proof of income
- Bank statements
- Proof of deposit
If you choose Trussle as your mortgage broker, we’ll notify you of the required documents you’re likely to need in advance to help you progress your application as quickly as possible.
Affordable housing schemes
There are a range of schemes that exist to help first time buyers to get onto the housing ladder, including:
- Help to Buy equity loan
- Help to Buy ISA
- Shared Ownership
With shared ownership schemes, you buy a proportion of your new home and rent the rest - increasing your ownership over time as you wish.