What Morgage for First Time Buyers

harding1985

Hiya all,

Thank god its friday :j

I need some of you mortgage experts to help us out. We have a combined annual income of 32k, we are looking to purchase a property around the 150k mark, and we have between 10-15% deposit, any advice on what mortgage to go for? We like the idea of a fixed rate instead of a tracker as we are a first time buyers.

We found one with Nationwide offering a 90% mortgage at the rate of 5.9%. Is that a good deal?

Cheers
Lee

TrickyDicky

I have recently been in a similar position, chosing a mortgage for a FTB with 10% deposit. For fixed, 5.9% would seem pretty good. We went for a tracker in the end though because it was 1.5% cheaper than a fixed and allowed unlimited overpayments - but we can also afford a 5% rise in interest rates. If you couldnt afford this kind of rise, then a fixed rate is the safest option.

Just before you look - could you afford, on top of the 10% deposit:-

£500-1000 for solicitors fees
£300+ for a survey
£1000 mortgage fees
Any moving costs (ranging from £100 to hire a van for a weekend to lots more for storage and moving firms?)
buildings insurance

Be warned, it appears mortgage companies are being conservative with house valuations at the moment, so if you're struggling for 10% plus the above when you make the offer, you're likely to have to haggle or lose the house when the mortgage company value the house at 10% under your offer.

Heres what I mean:

You offer £150k for a house - 10% deposit = £15000k
Mortgage value at £140k, so they will only lend you £126k - you now have to put down £24k as a deposit which you dont have unless you get the sale price down!

harding1985

Thanks for the reply

We will be able to afford the extra 3k for bits and bobs.

bit worrying about the mortage evaluation :-S

This is going to be stressful loool :rolleyes: