First time buyer worries

JadeLouise

Hi all,

We have now started the process of looking to buy a house. We currently live with my partners parents and have a 1.5 year old.
We have been saving for a deposit for about 4 months now and have 5.5k saved, 3,200k of that split between 2 help to buy ISA accounts. We have been looking at 5% mortgages and feel we would be able to afford the repayments after using a calculator and looking at a few 95% LTV mortgages.

The whole process worries me to the point where I think let's just rent but I'm excited at the same time. We both have sturdy jobs (I work for BT and partner is prison officer), but we're really young and I don't know if they take that into account. The steps to take confuse me and I'm worried we might not have good credit scores ... but don't really know how to reliably check them.

Any helpful tips or steps to take would be handy thank you

Edi81

Mortgages are available to those over 18.
As long as your 18 then you can apply.
Sounds like you need a broker to hold your hand through this.
Get copies of your credit files from the agencies - ignore the scores they mean nothing!

Thrugelmir

Will do you no harm to boost your savings further. You only get one bite of the HTB ISA.

GoingOn30

If you are nervous about buying then you'd do better to save more than the bare minimum of 5% for your deposit. If you can wait and save up to 10% you will be offered a better interest rate on your mortgage and better protected against potential negative equity.

AnotherJoe

If you can save 5% deposit in 4 months then I'd definitely wait another 4 months to get 10% plus a bit more to cover all the expenses which is not just the legalities also thinsg like all the stuff you need in a house - furniture, crockery, cooking equipment etc etc etc.

Kweedan

Hi,

In regards to reliably checking your credit score, have a look at the below:

Experian: https://www.moneysavingexpert.com/creditclub
Equifax: https://www.clearscore.com
Call Credit: https://www.noddle.co.uk

These are the three credit report companies that lenders use to check your credit history. Some things may show up on one that may not show up on another (For example I have a joint account with an overdraft that I set up in January with my partner for our mortgage payments, the hard credit search Nationwide did to accept us for this shows up on my Experian report but not my Equifax) so it is a good idea to sign up for all three and compare.

About age, I really don't think they look too much into it, they are only really interested in your credit history. I am 21 and my partner is 26 and we are in the middle of applying for our second mortgage after the first purchase fell through in February after we got the mortgage offer.

The only thing that really affects your mortgage application that may be linked to age is that young people tend to have a limited credit history, which puts lenders off as they want to know how you manage your finances, so they like people who have had phone contracts/credit cards etc for a long time to prove you can handle credit. However I have only had my phone contract less than a year and nothing else and so far so good (I did have my current application declined, but that was due to the valuation of the property - we have renegotiated and resubmitted the new purchase price against the existing application and we are back on).

The only thing that I would really recommend is saving as much as you can to increase your LTV, as 95% may scare the lenders.

Also, use a mortgage broker if you are not completely confident in doing it yourselves. However, it does not take much to do some affordability checks and look at current rates of the different lenders. Then, once you have decided who to go with, I think all of the high street lenders have consultants who will pretty much take you through everything. We went direct to Nationwide ourselves as thats who my partner has banked with for years, and he has a credit card with them, and we have an amazing consultant there in branch who has taken us through the whole thing and filled in everything for us. He has been absolutely brilliant and hasn't charged us a penny.

Hope this helps for you, and best of luck x

alan_d

Good luck on your house-buying journey.
My wife & I bought at 24, and like you, raised the deposit when living at home with parents. We have never rented - seemed a waste of money to me.
I'm now 42 and onto the 2nd house, and expect to have the remaining mortgage paid off in 2-3 years.
Buying young (and being careful with money!) means you can pay it off earlier than most

ACG

Living with the inlaws...yikes! I would literally rather pitch a tent up somewhere :P

Weve got a 1 year old baby - that is harder work than getting/having a Mortgage and more stressful. A Mortgage by comparison is a piece of cake and it also means you can decorate your childs bedroom without having to ask permission from a landlord.

5% is the minimum as has been said, providing the lender deems it affordable (you need to check their affordability calculators) then you should be fine. Just bare in mind that the calculators are as accurate as the information entered so just ensure you are filling them in as the lender wants you to fill them in (not as you think you should be completing them). Failing that, speak to a broker and let them take some of the stress away from you.

JadeLouise

Thank you all for your replies. I have set us both up experian and clear score accounts and we both have 997/999, not sure what this means, I assume good. I am quite organised and have kept our savings and spendings in order. I have done affordability checkers and is assuming we will be able to borrow much more than we are even looking at.

Having had a think about further legal fees and decorating on top of deposit, we are going to sit tight but will still look to get a feel of different areas and what to look for, I don't feel this will do any harm (unless we find one we love, oops).

Can anyone give me an estimate of the fees on top of the mortgage, such as surveyor, set up fee, solicitor etc ? I can't seem to find a definitive step by step list of who goes where.

Thank you all

ACG

Some lenders include free legals/valuation or cashback - but usually higher rates to balance it out.

But if you are paying for everything, solicitors would be from around £800 (including searches) at the lower end of the market right through to double that.

Surveys, again depend on the purchase price but they would start from around £250 but could just as easily be double that - it depends on the lender, the purchase price, the type of survey (basic, homebuyers or building survey).

Those are the only real compulsory fees.