getting a new house a bit clueless..

[ilcp]

As per the title. I would like to buy a house (first time) but no idea on how to go about it.

I know I should probably talk to lenders to see if they will give me a mortgage, but no idea on anything else like fees & the processes involved. Also I have used the calculators on various banks for how much money several banks will give me & the amounts have been too low and that has put me off.

I am currently earning 25k, have around 50k savings & 12K student loans.

One other thing, the current house belongs to my mum which I want to put on rent and then move to my new house but the question is if i do tell banks that would they charge me more interest as effectively its buy to let? but if i don't mention then I probably wont seem credible?

 

[Skeeter]

Buy To Let mortgages usually require 25% to 40% deposits and are a very different product to normal mortgages.

For a normal mortgage the extra charges are annoyingly well hidden from someone new to the idea of buying. There will be arrangements fees and solicitor fees coming to a few thousand in total. Then there's stamp duty which is between 0% and 7% of the property value depending on price.

If your a first time buyer there are a lot of schemes out there to help. The best is New Buy where the government will lend you a loan of 20% of a property value which you add to a 5% (or more) deposit to get into the much nicer 75% mortgage rates bracket. Then there's shared ownership where you buy only part of a house, and the mortgage guarantee where the government provide incentives for lenders to give 95% mortgages.

Speak to an independent mortgage advisor (its free, most estate agents will have a few names) to work out what you can afford and the type of rates your looking at, and then start looking from there.

 

[Luckystrike123]

X2 for seeing an independent mortgage advisor.

We recently bought our first house and the guy saved us loads of money as his software was a lot better than the free to use sites. He also gave some excellant advice re gifted deposits (we bought from relatives) which we would never have known about and was generally very very helpful.

 

[Maccapacca]

Free IFA's aren't 'free' they will be selling a product they receive a fee from and won't offer everything available. For more independent advice you should pay for one however it's not hard finding a mortgage with all the various comparison sites out there.

My last mortgage IFA who wanted £80 up front then £320 upon acceptance of offer found a mortgage I bettered in 30 minutes in my lunch time.

http://www.moneysavingexpert.com/mortgages/best-mortgages-cashback

 

[Skeeter]

Why suggest paying for an IFA, and then go on to say that the IFA you paid for was rubbish?

IFAs have their own tie ins, some with a few lenders, some with lots more. Thats why you go to a few when it comes to actually getting a Mortgage. Were only just starting to look and already have 2 IFAs and a bank on the go.

But for someone starting out, the affordability calculations and general ideas on % rates for what you can afford are going to be much of a muchness across any IFA, so sitting down with one for 30 minutes to know what you should look at should be step 1.

Step 2 is to shout curses at the housing market and frustrate over how bloody expensive some bricks are, and consign yourself to renting forever. But that comes later