Top Tips For First Time Buyers
1️⃣ Check Your Credit Report
Before applying for a mortgage, it’s helpful to review your credit report so you understand how lenders may view your application. Checking early also gives you time to correct any errors or address potential issues before applying.
2️⃣ Understand Your Budget
Before starting your property search, it’s important to understand what you can realistically afford. Consider your deposit, potential monthly payments, and other costs such as broker fees, legal fees and stamp duty.
3️⃣ Think About Future Affordability
When choosing a mortgage, it’s important to consider not only what you can afford today, but also how your finances may change in the future. Interest rates and personal circumstances can change over time.
4️⃣ Save for More Than Just the Deposit
Many buyers focus only on the deposit, but there are additional costs to consider such as solicitor fees, surveys, and moving expenses. Planning ahead will make the process smoother.
5️⃣ Seek Advice Before You Commit
Speaking with a mortgage adviser early can help you understand your options and ensure you are applying for a mortgage that suits your circumstances.
6️⃣ Get a Mortgage Agreement in Principle
An Agreement in Principle shows estate agents and sellers that you are a serious buyer and can help strengthen your position when making an offer on a property.
7️⃣ Explore Your Mortgage Options
There are many different mortgage products available, and some buyers may benefit from specialist options such as gifted deposits or Joint Borrower Sole Proprietor mortgages.
8️⃣ Don’t Be Afraid to Ask Questions
The mortgage process can feel complicated, especially for first-time buyers. Asking questions and getting advice along the way can help you feel more confident throughout the process.
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Gifted Deposits
A gifted deposit is when someone gives you money towards your property deposit, most commonly a parent or close family member.
Most lenders accept gifted deposits from family members, but fewer lenders will accept deposits gifted by friends or non-family members, and each lender has their own requirements.
At Dare2Dream Mortgages, we can help you understand which lenders accept gifted deposits and guide you through the process.
Buying With a Little Help
Some lenders offer mortgage options that allow another person, usually a family member, to help support your mortgage application.
Today, this is most commonly done through a Joint Borrower Sole Proprietor (JBSP) mortgage. This allows another person to support the mortgage using their income, while the property remains in the buyer’s name.
Many people still refer to these as guarantor mortgages, although most modern lender products now use the JBSP structure instead.
These options can help buyers who have a deposit but need additional support to access the property ladder.
At Dare2Dream Mortgages, we can help you understand whether this type of mortgage could work for your situation.
Understanding Your Credit Report
Before applying for a mortgage, it’s helpful to check your credit report so you understand how lenders may view your application.
Your credit report shows information about your financial history, including credit cards, loans, payment history and any missed payments. Lenders use this information to help assess whether they can offer you a mortgage.
When reviewing your report, look out for:
Payment history – missed or late payments can affect some mortgage applications.
Credit balances – high balances compared to limits may impact affordability.
Credit searches – multiple recent applications for credit can sometimes raise questions for lenders.
Incorrect information – occasionally reports contain errors, so it’s worth checking everything is accurate.
If you're unsure how your credit report might affect a mortgage application, getting advice before applying can help avoid unnecessary declines.
At Dare2Dream Mortgages, we can help review your situation and guide you towards lenders that may be suitable.
Mortgage Terms Made Simple
Buying your first home can feel confusing, especially when you hear lots of unfamiliar mortgage terms. Here are a few common ones explained in simple terms.
Agreement in Principle (AIP)
An Agreement in Principle is an initial indication from a lender showing how much you may be able to borrow, based on basic information about your income and finances.
Deposit
The deposit is the amount of money you contribute towards the purchase of a property. The rest is usually borrowed through a mortgage.
Loan to Value (LTV)
Loan to Value refers to the percentage of the property's value that you are borrowing. For example, if you have a 10% deposit, your mortgage would usually be 90% LTV.
Fixed Rate Mortgage
A fixed rate mortgage means your interest rate stays the same for a set period of time, helping keep your monthly payments predictable.
Standard Variable Rate (SVR)
The Standard Variable Rate is the interest rate a lender may move you onto after your initial mortgage deal ends.ragraph