I have seen banks offer mortgages with 0% deposit required, should I be wary of these? How about interest only mortgages? There's so many types of mortgages, it's hard to figure out the advantages and disadvantages of all.
Apart from a deposit, what other kind of money allowances should we make (I know we should put money aside for stamp duty, furniture and repairs/diy for the new house). Is there anything else we should think about?
Any other useful information?
Thanks!I want my first home! Where do I start finding out about mortgages and other issues for first time buyers?
OK.. here's my thoughts.
First: A mortgage is going to be a 30 year commitment. This means that for the next 30 years you will be committed to working for and paying for a home that will be co-owned by your boyfriend. You haven't made the commitment for marriage.. how can you make the type of long term financial commitment that will affect your credit and financial well being with out a strong commitment (ie marriage) to your partner? I would work this out first.
Now.. let's talk about first mortgage. Understand that a 0% down mortgage is financine 100% of the value of your home. This means that from day 1 you will have absolutely no equity in your home. Therefore you will owe more than the home is worth for at least 5 years or more and then after that only have a very small amount of equity. Therefore if you decide to sell the home in less than 10 years you will lose money in the investment unless the real estate market rises a lot in that area. This feeds into the first statement I made above.. let's say you two buy this home (no marriage) then the relationship falls apart and he moves out. If you can't make the mortgage payments and he doesn't provide you with assistance.. you lose the house and both of your credit ratings will be destroyed. Simply because you won't be able to sell the home for what is owed and you won't have the cash to make up the difference.
When it comes to a new home purchase here's my formula for success:
1. Have at least 10% for the downpayment.
2. Have the full amount needed for all closing cost.
3. Have enough money available for any needed repairs that will need to be done prior to move in.
4. Have enough money available for any furniture, appliances, etc that you might need when you move.
5. On top of 1 through 4, have at least a month's and a half mortgage payments in a saving account that you can draw on should a problem arrise that affects the financial stablity.
6. Work out a budget prior to buying the home. Include in this budget the mortgage payments, homeowner association dues, increase in utility payments, repairs etc.
7. Request your credit report and credit rating. Resolve any and all problems there that you can to push your credit rating as high as possible.
8. Shop around for a lender with the best terms.
9. Get a pre-approval letter from the lender with your maximum available loan amount.
10. Use a realator unassociated with the seller of the home you are wanting to buy and unassociated with the lender you have selected.
Hope this helps and good luck!I want my first home! Where do I start finding out about mortgages and other issues for first time buyers?
when u see a house for sale call the Realtor and ask them what the down payment is how much the house is worth when it was built what kid of people lived her first and have anyone died there is the roof new have there been any fires stuff like that or would the Realtor live there
You may wish to go and talk to someone at a bank first and get pre approved. That way you will know what you can afford.
My $.08
Contact to your bank/building society ASAP
When looking for a property, it might be better for you to go for a smaller house in nice area rather than big house in not-so-nice area. Properties in good areas tend to go up in value more over a period of time.
Speak to an independant financial advisor (not one that is tied to bank or building society) and ask them how much you could afford to borrow. If you are not thinking of buying until 2008, put aside however much you could afford a month and do this each month as if it was a mortgage. This will go towards fees involved in buying a house. Interest rates and best deals change all the time, but a financial advisor would be able to advise on this. When you buy a property, land searches need to be done, solicitors do this but be prepared to spend several thousand on all the different fees involved (this amount can be included in the mortgage. The only thing i would definately advise is to get a repayment mortgage, as opposed to an endowment mortgage.
Search on the internets.
look in mewspapers and the internet
realestate.yahoo.com/ - 46k -
I have a friend who works as a mortgage adviser for one of the big Building Society's, so pop into a local shop and make an appointment for a consultation, obviously they are not impartial but you don't have to sign anything and it does not cost you anything. Then go visit as many more Societies as you can stomach. Re no deposit, avoid like the plague. You might like to add moving costs (not cheep) to your list.
P.S. My friend's bonuses, promotion prospects etc are based on feedback from satisfied clients rather than what products she can sell.
Since you are not ready yet to do the purchasing keep saving your money, then when you are ready you just go to a bank and speak with the loans officer and they will give you every information you will need to get your home.
I would suggest calling your banker. They can be a great help when you're concerned about what you can or cannot afford and they can even help you find and apply for grants. My husband and I got a ';first time homebuyers'; grant when we bought our first home. It sounds like you don't live in America though, so I'm not sure what's available to you. It is a good idea to save money for things like closing costs and don't forget to check into the real estate taxes for any property you look at! A real estate agent is a great thing to have also! Hope I've helped and best of luck!!!
Ask friends and family to recommend a good company/real estate agent. They will be working FOR YOU so they are the best at offering you advice about your situation and getting you into a home. They are better than banks or mortgage companies because again, they are working for you, and they are the most knowledgeable in all areas of the business, all aspects. Be wary of anything that banks are offering, there is always a catch. Your best bet is to find a reliable, trustworthy Realtor that will work with your directly and for however long you need.
0% deposit sounds good, but you can get a lot better deal if you put down a deposit, 10% would be good, then i would go for a repayment mortage ,you can get these at a fixed rate for the first 2 or 3 years so you know exactly what you will be paying each month. then if interest rates go up during this period your payments won't. then at the end of the fixed period you can switch to a different mortage with a different lender and benefit from a fixed period all over again. theres no limit to how many times you can do this throughout the life of the mortage, so you could end up saving thousands. initially don't forget solicitors fees and removal costs. as for websites try moneysavingexpert.com full of great tips and hints, good luck p.
Okay, it sounds as if you're young so here is something I have to ask. Why are you and your boyfriend buying a home? I mean boyfriend, are you getting married? Do you plan on being together forever? Taking on a mortgage is a big step and lasts 1 to 30 years. Just think it over before taking that large jump!! Now, there are many resoures out there for for first time home buyers. Websites such as Bankrate.com or Quicken. Search and shop around.
Your first step would be to contact a local Realtor in your area. Have them go over with your homes you can afford and let them locate. The very best to you. It is a big happy step in your life
Congradulations! Do check out my website!
www.consideritfunded.com
United States and Mexico Mortgage only!
I am available anytime 24/7 to answer any questions or concerns you have regarding financing for your new home! I look forward in accomplishing your goals, providing you with excellent service and making the process simple!
Be sure to have a big enough deposit that will be at least 10% of your home cost, and be sure to get a fixed APR, variable APR's are for experienced home owners, so beware.
TOWNSPERSON-
You can find out in the evil cave. The evil cave is blocked by ice, youll need the fire rod.
hey i am doing exactly the same thing as you.
wrkey has given you great advice
i have done the same
try and visit lots of estate agents too and pick up lots of the paperwork they have like newspapers and leaflets that explain the different types of mortgages out there.
i have decided to go for a flexible as i earn bonuses and commission so i am able to pay more if i want to.
try loking on www.rightmove.co.uk
i have found this website great
i don't know.Search.
Call a salesman . . like century 21 etc. I just bought my first house in Temecula CA . . . . .pain in the **** but it was worth it. They will walk you through finding a place . . and put you in touch with lenders etc. . . they do all the work.
No comments:
Post a Comment