The Dos and Don'ts of Mortgages for First Time Buyers
|
Related UK Articles:
|
When you're a first time buyer looking to take out a mortgage, the whole process can seem a bit overwhelming. With so much on offer, and so much difference between the deals available, how can you be sure to get the best deal for you? Ultimately, getting a mortgage is not something to be entered into lightly, but if you bear in mind some key "dos and don'ts" then you should be able to navigate your way through the process. DON'T limit your options. Before making any concrete decisions, always be sure to have shopped around first so that you know exactly what is available. Various websites offer mortgage calculators and tables that can be helpful in letting you know what kind of deals are out there, for example www.mortgage.uk.com, and the BBC property site. However, don't forget that there will be smaller companies not included on these kinds of sites, so do your own research as well as looking to the 'experts'. DON'T be over-confident. A mortgage is secured against your house, and if you happen to default on any repayments your lender officially has the right to sell your home. Because of the high stakes in this process, it's wise to be cautious when it comes to agreeing on your mortgage term. It may seem like a great idea to get it all over and done with quickly, but if your financial situation changes for the worse then you may find yourself in hot water. The best option may be to get a flexible mortgage that allows you to make early repayments at no extra cost. DO remember that cost is important. It isn't everything, but particularly when you're a first time buyer it should be an important consideration. For many buyers new to the mortgage market, the costs of a mortgage deposit can be enough to put them off. Bearing this in mind, it's definitely worth putting some money aside in savings before getting your mortgage to prepare for the deposit. Many companies have now caught on to the fact that they need to make their deals more cost-conscious if they want business from first time buyers. Banks like Alliance & Leicester offer Discount Mortgages catering to those who want smaller repayments for the first few years, and HSBC offer mortgages catering specifically to graduates, with various schemes to help them out financially. DO make sure you understand all of the key terms used by mortgage brokers before making any decisions. It's all very well spotting a great looking deal on an advert or by word of mouth, but it's not worth investing in it unless you're sure you fully understand how it will work and if it is right for your situation. A useful sight to teach you the key terms and frequently used jargon is the FSA site Money Made Clear (www.moneymadeclear.fsa.gov.uk). Their mortgage jargon buster takes you through a series of words and phrases that you will need to understand when getting your first mortgage. Rates and products quoted are correct at the time of writing (18.06.08) and may be changed at the discretion of the provider.
|
