First Time Buyers, A Mortgage Guide

So you’re looking for a mortgage to buy your first home. You’re ready to put your foot on the first rung of what’s popularly known as “The property ladder.” No doubt you watch the TV news and read the newspapers so you’ve probably gathered that now is just about the worst time for many years to start looking for a mortgage. Banks and building societies are far more cautious about taking on new mortgage business than they have been. You should still get a loan but it’s going to cost you a lot more than it would just a few weeks ago, days even! What may well be rather more of a concern in your situation is that the days of 90 to 100% mortgages are over. For the foreseeable future that is anyway. We’re back to the way it was about 40 years ago when the most you could expect to borrow was 75 to 80% of valuation. That means you need to find a much bigger deposit from savings or elsewhere. That’s the bad news. Well, the good news is that there is some light at the end of the tunnel although it’s quite a long tunnel. Historically the sort of situation we’re in just now doesn’t last forever and that’s something that might work in your favour in the long term. So, let’s apply some positive thinking to your situation before you get overwhelmed by despair! First, if you’re a first time buyer, you’re probably young. Youth your most valuable asset at present so make the most of it. It doesn’t last for ever! So how does being young help? Well for one thing you’ve probably embarked on a career that’ll see your income rise steadily over a great many years. Not only that but you’ll have most of your working life stretching out in front of you so if you have to take on a mortgage over a very long term, well you’ve got plenty of time haven’t you! Retirement age for most of us is set to get higher and higher as we all live longer so you’ll have even more productive years to look forward to than your parents had at your age. We know your mortgage is going to consume more of your income than it would have done previously but at least you know that before you start. You won’t start off on a low rate only to feel the pinch later. If that means you have to do without the huge plasma screen telly and the holidays in Thailand or wherever so be it. You’re young, you can cope and you’re getting the lean years over at the beginning and, it should get easier with time. Anyway, you’re a first time buyer and that was never easy. It’s got worse we know and that means that for your first time buyer mortgage, now more than ever, you really need the help of a first class mortgage broker. Once you’ve got your mortgage and moved into your house, do-it-yourself is something you’ll need to become good at no doubt but this is not the place to start! Up until recently you could have walked into any high street bank or building society and got a mortgage of some sort. In fact they were falling over themselves to get you in through the door. You would never have got the best deal possible, you always needed a broker for that, but at least you’d have got your first time buyer mortgage. Now they’re turning people away because funds are tight. Your broker, however, knows where to go and can open doors that are firmly closed to you on your own. Now even the best of brokers isn’t going to be able to get you the kind of deal that was possible up until very recently but at least you’ll end up with a mortgage so you can go ahead with buying that all important first home. If you’ve chosen a really good broker who deals with the whole of the mortgage market and not just a few favourite lenders you’ll know you’ve got the best deal anyone could have found at the present time. Nothing is forever and while you’re struggling in those first few years with your first time buyers mortgage remember that as your pay gradually goes up the pressure will begin to ease a bit and eventually you’ll find you can start to afford some of the things you’ve been doing without if you don’t go mad with them! That’s if you still want them of course. People often find after a few years of struggling that those luxury “must haves” of earlier years don’t seem quite so important to them any more. Credit to Martyn Barberry - 1articleworld.com