The UK mortgage market consists of hundreds of lenders and potentially thousands of different mortgage deals at any one time – and those deals are constantly changing as a result of both competition between lenders and broader economic factors. Navigating the market to find the most appropriate lender and deal for your unique circumstances can be overwhelming – particularly if you’re a first-time buyer. However, it’s not a journey you have to make alone; at Just Mortgage Brokers we can help find the mortgage that’s right for you.

What challenges might I face as a first-time buyer?

While the number of first-time buyers crashed in the aftermath of the 2008 global financial crisis, the years since have seen a steady increase in the number of people buying a home for the first time. However, arranging the finances for the purchase of your first property isn’t without its challenges, particularly in the face of high property prices and more rigorous mortgage lending criteria.

For many would-be homebuyers, the first challenge is in building a deposit to buy their first home. For better or worse, the days of 100% mortgages are long gone, and today lenders will typically lend no more than 95% of the property value – and if you want to qualify for better rates, you may have to put down an even bigger deposit still. With the average UK house price now over £240,000, saving a deposit of 5%, 10% or more can be a considerable challenge. Fortunately, there are a number of government Help to Buy schemes currently available, which are designed to make it easier for people to get on the property ladder.

Depending on your credit history, getting a lender to approve a first-time buyer mortgage also presents a challenge for some. Fortunately, a poor or limited credit history needn’t always be a barrier to getting a mortgage, and at Just Mortgage Brokers we have considerable experience in helping people with bad credit get the mortgage that best suits their needs.

What types of mortgages can I get as a first-time buyer?

As a first-time buyer it’s important to be aware of the various mortgage options available to you. In recent years many first-time buyers have benefitted from a range of government schemes designed to make buying a home more affordable. These are collectively know as Help to Buy schemes, and you can find more information about the various options here.

In terms of types of mortgages, one of the first decisions you are likely to make is whether to opt for a fixed-rate or variable-rate mortgage. As the name suggests, fixed-rate mortgages have a rate of interest that is fixed for a certain term – typically 3, 5 or 10 years – during which your monthly payments will not change. This type of mortgage provides the stability of knowing that your mortgage payments will not increase, however fixed-rate deals are often priced higher than equivalent variable-rate mortgages.

Variable-rate mortgages have an interest rate that can go up or down, usually in line with either the Bank of England base rate, or the lender’s own standard variable rate (SVR). The most common type of variable-rate mortgage is known as a tracker mortgage, but other types of products are available, including discounted and capped rates. If you opt for a variable-rate mortgage, it’s important to be aware that your mortgage payments could go up at any time.

How can I improve my chances of being approved?

While your employment and salary details will be taken into account when you apply for a mortgage, these aren’t the only factors that lenders will consider. Another major factor that will affect whether you get approved for a mortgage, how much you can borrow and the interest rate, is your credit history. You can improve your chances by keeping up with payments on any credit commitments you have, and making sure all your bills are paid on time. Other factors can also affect your credit score, such as whether you are on the electoral register. To make sure your mortgage application goes as smoothly as possible, you should make sure you have payslips and bank statements (typically three months’ worth) as well as any other documentation the lender requests to verify your identity and your income.

How much can I borrow and how much will it cost?

Under financial regulations lenders are required to lend responsibly to borrowers who can prove that they will be able to afford the mortgage repayments on an ongoing basis. A number of factors are taken into account when lenders work out how much you can afford to borrow, including your employment status, income and outgoings, your credit history, and how big a deposit you are putting down. These factors can also affect the interest rates available to you and, in turn, how much your monthly mortgage payments will be. Factors such as a poor credit history or a lower deposit can restrict the mortgage deals that you will have access to and, conversely, a good credit record and a larger deposit will in turn make more attractive mortgage products available.

How Just Mortgage Brokers can help

At Just Mortgage Brokers we have a team of mortgage experts with a depth of experience in helping first-time buyers get that first foot on the property ladder. Regardless of your circumstances – including if you have had credit problems in the past – we can help find the mortgage that’s right for you. Contact us today to discuss how we can help you buy your first home.