Buying Your First Home

Posted on February 28, 2023

So you’ve been saving up for years and have finally got enough money to buy your first home. Congratulations! This is a big step for anyone, but it can be even more daunting if you’re not sure where to start. In this guide, we’ll help you figure out how much house you can afford, what kind of mortgage that will require and where your best options are.

How much can you afford?

Before you start looking for a house, it’s important to know exactly how much money you can comfortably afford. Your budget is the sum of all your monthly expenses–including rent or mortgage payments, utilities and groceries–plus any additional costs such as car payments or student loans.

Once you have an idea of what’s in your budget and what isn’t , write down everything on paper so that there are no surprises later on when actual figures come into play. You’ll also want to consider whether or not any large purchases will be coming up soon such as buying furniture etc.

Do you have a deposit saved up?

If you’re planning on buying a house, the first thing to do is figure out how much deposit you’ll need. The amount varies depending on the market and type of property you’re looking at. You’ll also need to consider what kind of mortgage product best suits your needs.

A good rule of thumb is that the more money you have saved up for your deposit, the better chance there is that lenders will accept your application and approve it.

Are you eligible for help to buy?

If you’re a first time buyer, help to buy could be an option for you. The scheme enables people who can’t afford the deposit required for their first mortgage to get an equity loan from the government which will cover up to 20% of the cost of a newly built property.

Here are some things to know about help to buy:

• You’ll need a 5% deposit as well as other funds for stamp duty and legal fees – but if your income is below £80k per year (or £90k if buying in London) then it’s possible that these costs could be covered by Help To Buy too!
• There are two types of scheme available – one where homeowners pay back their loans over 15 years at an interest rate fixed at 1%, while another allows them access these funds in one lump sum after five years with no further payments required until they sell or move house again before then.*

What kind of mortgage do you want?

You’ll also want to consider the type of mortgage you want. There are a few options, including fixed rate and variable rate mortgages. A fixed-rate mortgage means your monthly payment will remain the same throughout the life of your loan (usually 5-30 years). Variable rates may change with market conditions but can be lower than a traditional fixed rate at times.

A third option is an interest-only mortgage where you only pay interest for part or all of your term; this gives you flexibility if money gets tight but doesn’t help build any equity in your home if you don’t make any payments towards the mortgage balance as well.

How do I know how much house I can afford?

The first step to buying your first home is to figure out how much you can afford. This will depend on a number of factors, including:

• The amount of income you earn and how much money is coming in each month (your monthly income).
• How much money you have saved up for a deposit (the amount of savings).
• The amount of debt you have, such as credit card debt or student loans (your debts).
• The price tag for the property itself (the purchase price).

Buying your first home is a big step, but it can be done!

Buying your first home is a big step. But it can be done!

You’ll need to save up a deposit, check your credit score and affordability, get help from the government if you need it and find a mortgage that fits your needs.

As long as you’re prepared and know what to expect, getting your foot on the property ladder can be an exciting and rewarding experience.

If you would like help finding your first property in Sunderland, contact our team at Hackett Properties.