5 Top Tips for First-Time Buyers

Stepping onto that first rung of the property ladder can be difficult, especially with house prices so high and interest rates unpredictable. So, we’ve put together five tips for first time buyers to help you explore your options, maximise your deposit and feel more confident about the whole process.

Boost your deposit

Saving for a deposit is key, but many people are losing out on free money because they don’t know about the government benefits that come with a Lifetime ISA (or LISA). Put up to £4,000 a year into a LISA and you’ll qualify for a 25% bonus on everything you save. That’s up to £1,000 a year – an easy way to make your deposit go further.

Investigate other affordable housing schemes

There may be other government schemes that could help you get more for your money or qualify for a mortgage on a lower income. Shared ownership for instance allows you to buy a share in a property, normally between 25% and 75%, and then increase your share over time.

2023 is good for first time buyers with low deposits as the government’s mortgage guarantee scheme has been extended until the end of the year. The scheme offers financial guarantees to lenders offering 95% mortgages, meaning more options available for borrowers with a 5% deposit.

Speak to a specialist broker

Don’t assume that financial experts are just for the wealthy – a mortgage broker is invaluable whatever size mortgage you’re looking for. First time buyers in particular can benefit from using a broker who specialises in securing these types of mortgage, as every penny counts when you’re on a tight budget.

A good broker will have access to the whole market and will research and compare the best first time buyer mortgages for you. Even small savings on rates can have a big impact on the cost of your mortgage over the term, so it’s worth letting your broker shop around for the very best deals.

Check your credit reports

It can be daunting to check your credit reports, especially if you’ve struggled with debt in the past, but it’s vital to have an accurate picture of where you stand before you approach mortgage lenders. Share what you find with your broker and even if you have bad credit, they may still be able to find you the mortgage you need.

Head to our credit reports hub to find out how to check your credit reports for free.

Get an agreement in principle

Don’t wait until you have found your dream home before getting your finance in place, as you could end up missing out. Many estate agents won’t even accept an offer until you have a provisional yes on a mortgage, known as an agreement in principle. Your broker will be able to guide you through the process, which is normally valid for 2-3 months, giving you time to get house hunting.

If you get in touch we can arrange for a broker we work with who has experience helping first-time buyers secure the mortgage they need to contact you straight away.