First-time buyers’ guide



Who doesn’t want to feel the excitement of living in their own home? Buying your first home, as thrilling as it may sounds, it is likely to be one of the most important decisions in your life thus quite time-consuming and confusing. The process may seem complicated but it can also be as easy as ABC if you break it down and make one step at a time. Our useful guide will help you gather all the information needed and be one step closer to becoming a homeowner.


1. Buying Pros and Cons

What you need to consider in the first place on whether to rent or to buy are the pros and cons. Buying may not be suitable for everyone and it is not everyone’s need to buy. The upside is, of course, the fact that it is a property investment, and after the mortgage is paid off you will own a home, able to live exactly how you want, decorate, refurbish and make any changes the way you desire as you will be the landlord of yourself. There is also a possibility that its value can be increased and make a great profit out of it.

The downside is the cost. Future buyers have to save for a deposit which has to be at least 10% of the property’s value, particularly in London, where the prices are almost double than the rest of the country. Moreover, you would have to submit to a credit score control to prove you can afford to repay the mortgage. Finally, some extra fees may occur that you would have to keep in mind, such as solicitors’ fees, valuation reports, Stamp Duty, moving costs and mortgage rate changes.


Read more: Buying off plan: Should you or shouldn’t you?


2. Finding a mortgage

There is a variety of mortgages to choose from, without meaning that you have to choose the cheapest one, as there are many factors to take into consideration. Basically, all mortgages work in the same way; you borrow money to buy a property with an interest applied that eventually, you pay back. The different types of mortgages are:

  • Interest only mortgage: The applicant pays the mortgage interest month by month and repays the capital at the end of the period with money that has saved.
  • Fixed rate mortgage: This is a quite popular one as the mortgage rate is already fixed for a set number of years, so there are no surprises every month, with the only fear that the rates on other mortgages may go down and you will end up overpaying.
  • Tracker mortgage: The interest rate is linked to the Bank of England base rate so payments may vary
  • Discount mortgage: The discount is a reduction in the lender’s standard variable rate (SVR). These are most of the times the cheapest ones but as they are linked to the SVR the rates may increase and decrease depending on it. Discount mortgages are available over different terms –typically one to five years- and you may be charged a fee if you decide to break the deal during the term.

There are also many schemes where you can seek for help, such as Help to Buy, Starter Homes and Shared Ownership.


Read more: 17 year wait before single, first-time buyers can afford a 15% London deposit


3. Finding a property

To find your dream home you have to be absolutely sure that your viewings fulfil the majority of your needs.  Make a list of locations and things that your ideal home should include and take it with you on every viewing. If you’re buying a property through an agent keep in mind that you need to maintain a good relationship. To be the perfect candidate and eventually buyer give your agent a thorough list of what you are looking for. Keeping in touch and specifying your budget from the beginning will prove how serious you are and help you make a good deal.


4. The Solicitor or Licenced Conveyancer

Once you have found your ideal home and have had an offer accepted, your agent will ask you for the details of your solicitor or licensed conveyancer. You are the one responsible to find one, either from a relative or a friend or a firm on your local postcode area. Their main duty is to:

  • Investigate the legal title to the property
  • Check whether the buyer has the monies required to afford the property and all the fees required
  • Provide any legal advice and recommendations
  • Communicate with the seller’s solicitor and agree on a purchase completion date
  • Draft the Transfer Deed
  • Attend to completion of the purchase
  • Arrange payment for any Stamp Duty and Land Registry fees for registration of the transfer and any mortgage


Read more: Hot Spots for Property Investments


At Discount Landlord, we are committed to helping you protect your property with a Home Insurance policy suitable for you. For a quick quote, give us a call on 0800 294 4522 today!

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28th June 2018