First-time buyer? Here's what you need to know!
There will be plenty of people across Cardiff looking to make 2019 the year they get their foot on the property ladder, and that will come with a lot of property searching, stress, decisions and buyer-related questions.
Fortunately, our expert team here at CPS Homes can help you with all of that, and we're going to address some of the things that many first-time buyers really ought to know right here.
Getting a mortgage
Successfully getting a mortgage can be a tough process, but there are plenty of good lenders out there who are willing to help young people get on the property ladder for the first-time.
Some lenders in the industry claim that as many as 90% of all first-time buyers that they deal with are able to successfully achieve a mortgage, so it's definitely within reach – it just means putting yourself into a safe position financially and doing your research.
Bad credit and outstanding debt is typically the downfall for the other 10%, but sorting these out and getting yourself on a positive financial footing will mean you are much better placed to get a mortgage a year or two down the line.
Things mortgage lenders consider
Lenders consider a whole host of different things when you apply for a mortgage, but there is a list of main things that they almost always look out for.
Your income or combined income if there are two of you will be checked so that the lender can be sure you're able to pay back the loan over the course of your repayment period. The last thing you want to do is lose your property by failing to pay your mortgage payments, and this is one step the lender will take to ensure the chances of that happening are kept to a minimum.
Credit history is one of the main factors. Poor credit or a history of missed or late payments on credit cards or loans will result in obtaining a mortgage being far more difficult. Your deposit is also a big factor. The bigger the deposit the better, as you'll find it easier to secure a better deal than those with a lesser deposit.
Required evidence
It's best to make sure you're well prepared when you're getting ready to apply for a mortgage, and this includes having things to hand that prove your identification, salary and things like that.
For a hassle-free application it's good to have the following things readily available:
- Past 3 months payslips
- Past 3 months bank statements
- Proof of ID (driving licence, passport)
- Details of any family members who are gifting money towards the purchase
Paying the mortgage
Once your deposit is paid, the rest will be paid back in monthly instalments over a set number of years. Each mortgage will differ depending on the amount that you borrow. You can either have a higher bill (affordability depending) each month and pay back the amount owed over fewer years, or pay a lower bill each month over a longer period.
Your mortgage can be amended to fit your personal financial position and what you can afford to pay each month regularly.
Other things you have to pay
Solicitors fees to cover the legal work will be one of the largest expenses when you purchase a property. The fees typically range from £850 to over £1,000 incl. VAT.
Your solicitor will also carry out local searches to ensure there are no problems or proposed plans that could affect the property, and these will cost an additional few hundred pounds.
Depending on your current living situation, you may also come across new bills that need to be paid, such as council tax, gas, electricity and water. The internet, TV packages and other additional entertainment services are also bills that you will need to consider when budgeting what you can afford.
Other things you may need
You will want to explore things like buildings insurance and contents insurance. The former covers damage to the fabric of a property such as fixtures and fittings, while the latter covers your belongings. Life insurance could also be considered, and the cost of policies differ depending on a range of things. These are all things that are worth investigating and comparing rates.
Time it takes for the purchase to complete
Even if you're offered a mortgage very quickly, there are still plenty of other things that need to be completed before you get the keys to your first property.
There is no set time for completion, but you can certainly expect a couple of months at least in the majority of cases. Things that can cause a delay include being in a chain or waiting for queries to be resolved, but plenty of other things can cause a hiccup or two as well.
Checks and searches are made, forms are filled in, phone calls and e-mails are being exchanged all over the place. You may find yourselves going back and forth a lot with your solicitor, but it's all part of the process and needs to be done for things to progress towards completion.
Even holidays from any of the involved parties can cause a delay!
Property purchases do fall through
It's the worst case scenario, but it does happen. Deals do fall through and it can happen at any time, even if your offer has been accepted.
It's always worth remembering this, just so you're prepared if you end up finding yourself in this situation. The right property for you will still be out there for you somewhere!
If you're a first-time buyer looking for your dream property in Cardiff, check out our buying guide and get in touch with us today. Our team have extensive knowledge of the city and can help guide you through the process every step of the way. Call us today on 02920 668585, e-mail enquiries@cpshomes.co.uk or pop into one of our three Cardiff branches.
