Mortgage in principle for first time buyer

mike44_2

Evening All,

Me and my OH has just been approved for a mortgage in principle from Lloyds. We have been approved for 216K (240K property price - 24K deposit). At the moment we are considering two options;
1) 5.99 fixed for 2 years plus 890£ fee
2) 5.79 fixed for 5 years plus 890£ fee

We haven't spoken to any of the mortgage advisors, hence here are my questions:

a) Do you think are there better mortgage deals for first time buyers with 10% deposit for property around 240K where our joined salary is 49500£? Is it worth to pay a mortgage advisor to get a better deal or we should stick with Lloyds? I have looked around a bit and it looks like there are not too many 90% mortgages available for first time buyers.
b) We personally think that 5 years is a better choice for us, as it gives more security considerng uncertain future and possible drop in house prices. Do you think is that a right choice?

Any help is much appreciated.

Thanks

FinAdv

Hi,

You are right. There aren't too many options for FTB and 90% LTV.

But you can always go to a Mortgage Adviser to check the deals. They wont charge you just to provide quotes unless you decide to process the application through them. No harm in trying. Try HSBC. They are a bit stringent in giving the mortgage but have good deals. They are giving 2 yr fixed for 4.99%. Not sure about 5 yr fixed.

Dont rush and take your time. Its one of the most important financial decision you will probably make. Check out with some more lenders before committing anything with Lloyds.

Also, 5 yr fixed is definitely a good option at this time since it would give you a peace of mind especailly with interest rates expecting to rise any moment!

Regards and best of luck!!!

mike44_2

Thanks. I will talk to mortgage advisor just to make sure I haven't missed anything.

BadgerFace_2

I would say you are very much at the limit of your borrowing capability going on that loan and salary for a joint mortgage. I'm not sure you can afford to be too picky...maybe a broker could do better.

bobbadog

Britannia are currently offering 4% something for FTB up to 90% LTV.

dimbo61

Put the figures into "whatsthecost" and see how much you would have paid off over the 2/5 year deals!
Then consider a few things
1 plans for kids? how good are local schools and distance to walk/drive
2 job how safe and any pay rises due ( can you afford the mortgage on one wage)
3 forever house or move in 2/3 years!
4 Does this property need work/improving ?
5 what would the LTV be in 2 years and in 5 years if house prices stay the same ( IE can you get below 75% LTV when you come to remortgage.

northeast1

abbey have a product with same rate as 2 year fixed but with a lower arrangement fee

mike44_2

Put the figures into "whatsthecost" and see how much you would have paid off over the 2/5 year deals!
Then consider a few things
1 plans for kids? how good are local schools and distance to walk/drive
2 job how safe and any pay rises due ( can you afford the mortgage on one wage)
3 forever house or move in 2/3 years!
4 Does this property need work/improving ?
5 what would the LTV be in 2 years and in 5 years if house prices stay the same ( IE can you get below 75% LTV when you come to remortgage.

Very good points. I have already considered 1,2,3 but I haven't thought about 4 and 5.

Britannia are currently offering 4% something for FTB up to 90% LTV.

The only one 90% LTV first time buyer mortgage I found on Britannia website was 5 years fixed at 5.89 with 999£ fee. Could post a link to their website with that offer?