Tips for first-time buyers: Mortgages demystified

Buying your first home is an exciting time but it comes with lots of challenges, questions and, understandably, sometimes a bit of anxiety. First-time buyers can experience a steep learning curve on all the processes involved with buying property, most notably regarding mortgages.

Power is knowledge in the mortgage market and all buyers can significantly benefit by making informed decisions. By acquiring the right information beforehand, you can select the most suitable mortgage and potentially save a lot of money.

You may have heard of first-time buyer mortgages, which are, as you would guess, mortgages aimed at people buying their first home. Although there is no specific type of mortgage for a first-time buyer, these mortgages are often marketed to first-time buyers because they offer a discount or benefit, such as cashback.

Did you know…

Recent data states that there were 290,000 first-time buyers in the UK in 2023 which accounts for more than 50% of all mortgages taken out during the year. This is why lenders often market their mortgages as first-time buyer mortgages, considering the market is heavily saturated with new applicants. The same source states that first-time buyers have risen over the last decade.

Image showing a happy couple painting samples on the wall

There are many ways to improve your credit score which are best discussed on an individual basis.

Tips for navigating the mortgage process

When applying for a mortgage, the lender will conduct several tests to ensure you can afford the loan you need. They will also consider whether you’re likely to keep up with repayments by assessing your credit score and seeing how you have repaid credit in the recent past. Thus, your credit score impacts whether you’ll be approved and should be considered in the months leading up to an application. There are many ways to improve your credit score which are best discussed on an individual basis.

When comparing different mortgages, you need to start by knowing which type of mortgage you want. The two main mortgage types are fixed-rate mortgages and variable-rate mortgages. The former is when a fixed interest rate is charged so payments remain the same for a specific length of time, whereas a variable rate mortgage is subject to repayment fluctuations.

Understanding which type of mortgage is most suitable for you is best discussed with a trained financial planner or mortgage adviser. They will conduct a personalised assessment of your income, existing debts, long-term financial objectives and preferences to identify the most appropriate mortgage that could even save you money.

Moreover, by using the services of an experienced mortgage adviser, they will also work to broker you a deal and may even leverage industry connections to secure you a mortgage that isn’t widely advertised or available. Even better, our mortgage advisers aren’t aligned with any lenders and will search the mortgage market. We take a commission from the lender and don’t charge you a penny.

Book your consultation with a James Leighton mortgage adviser now!