First time buyer, largish deposit

kanye1

Hello all,

Im looking to buy my first property. Slightly confused about how to go about it, with the new rules coming in.

Deposit
£77k saved + £20,000 from my parents= Total £97k.

Salary
Current salary is £38,300 + £3000 bonus a year.

Outgoings per month
£157 pension
£300 petrol, food etc

Status
Nearly 30.
No children
Single
Properties I am look go up to a value of £240,000 maximum, in a good area.
Intention is to move into the house.
I have looked at calculators seem to be able to borrow between £140,000 - 170,000.

Im getting conflicting advice from banks and estate agents.

1)Should I be finding a property first, then make an offer and then go to the bank about a mortgage? (as banks are suggesting with new rules)

2) Or visit the bank/ a broker first to get a mortgage in principle and then look at finding a property? Some estate agents have suggested they would not accept an offer without having something in principle first, or consider me a serious buyer? As properties are selling fast in the areas I am looking (within days)

3) Also should I avoid financial advisors linked to the estate agent?

Thanks

cattie

It's always best to have a MIP offer first before viewing & wishing to make offers on a property as it tends to be the main way that ea's & vendors know that you are a serious buyer & can afford to buy the property.

What you need is a whole of market mortgage advisor. Some ea's do have these, some don't, so you need to check their status out first before choosing who or where to go to for mortgage advice.

And well done on saving such a huge sum, you should feel very proud of yourself.

Pixie5740

I would avoid financial advisors linked to the estage agent. I'm using a whole of market mortgage broker who got a DIP from one of the main lenders for me which gave me a good idea of my budget. The DIP came back with a much larger amount than I would ever wish to borrow which was nice. Then I looked at property and put an offer in.

ConfusedofYorkshire

I would have the application ready to get an mip, as you can get it within minutes once you press the button. As long as you've checked you credit scores and affordability this is fairly safe.

But if you get an mip then take a long time to find house then it can expire and then you may get rejected due to too many checks. Also, a better deal may come along and you may want to use a different bank.

I put my offer in, estate agent said is your mortgage sorted. I said yes, offer accepted, pressed the button, got mip to show agent.

Pandilex

I don't know what the new rules are but my position is virtually identical to yours, similar deposit, salary etc.

You should find a mortgage broker first and they will help you price up a few possibilities. They should put your deposit into the computer and press a button and get the best mortgages for you. Then they can give you some ideas, for example the best mortgage to buy a house of 250,000 based on your deposit will cost X paid back over 15 years, Y over 20 years, Z over 25 years, etc. and can quickly compile a few different prices.

This will give you a great idea of what to expect from a mortgage and also help you decide how much to spend.

Once you have some ideas of figures and your budget (your budget will probably change over the course of looking, mine did) go and look at properties. I would DEFINITELY not recommend going directly to a bank for the mortgage. I got an identical deal to the one the bank offered directly through a broker (free!) and the broker was incredibly helpful. I merely just threw some copies of stuff at him and he photocopied and submitted the whole application etc. on my behalf and e-mails me with what's going on etc. I would hate to have to deal with the bank directly - it took an hour in the branch just for them to find someone to talk to about a mortgage who ended up giving me the wrong information.

My experience of looking is that houses are selling like hotcakes, often a house having up to 10 offers on the SAME DAY (if they do an open house viewing). So expect to have to make an offer immediately, or at least before 10am the next day. In high demand areas it'll go to sealed bid where they ask for your final offer, which in my case was 11k above asking price (lost out on other houses where I offered even 10k over!).

At this point you will want to tell them your situation: first time buyer, deposit, and if you've been to your broker, that you have a mortgage lined up (even if it is just theoretical, but don't tell them that) in principal.

The seller will look at all the offers and choose one. A big deposit will help cos it means you're less likely to flake out.

With regard to viewing houses my advice is to set up some searches on rightmove, zoopla, and your local estate agents. I created bookmarks for each with the exact parameters I was looking for and just clicked through them. Estate agents rarely bother chasing you, you have to be proactive and phone them when you see a property on the market.

I am using a mortgage broker linked to an estate agent (they are independent) and have not had any problems - they don't charge a fee. I don't use the agent's solicitors although the seller is using them according to the documentation.

So summary:

- Go to mortgage broker, number crunch everything
- Book a ton of viewings, ask how many offers they're receiving, try to work out what you want (it will change)
- Ask broker if people are offering over asking price in general and other general questions, they should be helpful on all kinds of noob questions they were for me

kanye1

Hello all,

Thanks for the replies this really clears things up, as the whole thing can be confusing!!

Looking for brokers as we speak on unbiased.co.uk

kanye1

cattie wrote: »

It's always best to have a MIP offer first before viewing & wishing to make offers on a property as it tends to be the main way that ea's & vendors know that you are a serious buyer & can afford to buy the property.

What you need is a whole of market mortgage advisor. Some ea's do have these, some don't, so you need to check their status out first before choosing who or where to go to for mortgage advice.

And well done on saving such a huge sum, you should feel very proud of yourself.

Hey thanks

I been saving for 7 years, but my salary has only really increased in the last couple. My aim was to always save 80k by the time I was 30, looks like Im going to make it ..just.

kanye1

Ive found a broker, he said the intial meeting was free, seemed genuine.

He said there is a fee, but it would be on taken on completion of the mortgage and depend on circumstances.

ladyabouttown

Paperwork, paperwork and more paperwork. Have photocopies of your passport, physical bank statements, proof of address (utilities etc.), payslips, job contracts and proof of deposit (bank statement with the full amount).