First time buyer’s guide to buying your first home

By Furness Building Society

How to buy your first home

So, you’ve decided you’re ready to buy your first home - exciting stuff!

But it can also feel pretty nerve-wracking. Don’t worry, while it’s a big commitment and needs to be taken seriously, it doesn’t need to be difficult. 

If you need some mortgage advice, our ‘first time buyer’s guide to buying your first home’ will explain your options clearly and concisely and set out the main things you need to consider when buying your first house.

Two women sat on a sofa, smiling and enjoying their first home.

Your mortgage affordability

Can you afford a mortgage?

Take a long, hard look at your spending habits and assess how you spend your money. This is the first thing you should do and brokers and lenders, like us, can talk to you about this if you need some support.

You can book an appointment with one of our advisors, who will help you work out what mortgage payments you can afford each month based on your income and outgoings. The repayments need to be realistic for you to still have some money left over each month for household bills and any other commitments.

Top tip: Use our mortgage finder to see what mortgages could be available to you when buying your first home

 

What deposit do you need for a mortgage

Do you have a good credit score?

Mortgage fees and costs

What are the costs to consider when buying a house?

When you do your sums, you’ll need to take into account the full costs of buying a house and the fees you pay when getting a mortgage. Here we’ve rounded up the main costs to consider when buying a house - you should put some money to one side to cover these if you can.

 

Typical fees include:

  • Arrangement fee - (also known as a booking fee or completion fee) - this is the admin cost to set up the mortgage loan. It can often be added to the mortgage so you don’t typically pay it right away.
  • Valuation fee - this pays for an inspection of your new home and gives an estimated value of how much the property is worth. You need to pay this upfront as part of the mortgage application process.
  • Survey - this is a thorough check of a home to spot things such as damp or structural damage. It’s optional but advisable, particularly if you’re buying an older property. You will typically pay this before you move into your new home.
  • Legal fees - these are paid to your solicitor and covers the legal work associated with buying a home, such as conveyancing (the legal transfer of a property from one person to another). These are paid towards the end of the process when you have moved in - you’ll be sent an invoice from your solicitor.
  • Stamp duty - this is the tax paid to the government when buying a residential property or piece of land (known officially as Stamp Duty Land Tax or SDLT). This is paid upfront while you’re in the process of buying the house although sometimes it can be added to the invoice for your legal fees from your solicitor.
  • Moving fees - including the costs for a removal company or van hire to help you move your belongings into your new home. These are usually paid in advance of you moving or if not, immediately afterwards.

Do first time buyers pay stamp duty?

Ways to buy your first home

Are you getting a joint mortgage?

Most couples buy a property jointly and both names go on the mortgage and property deeds. This is known as a joint mortgage and you’re both responsible for the monthly payments.

Are you asking family to help you get a mortgage?

Are you a self-employed first time buyer?

Are you using a broker?

Applying for a mortgage

Have you got a Decision in Principle?

A Decision in Principle (also known as an Agreement in Principle or AiP) is useful to have in a competitive property market. You'll likely be asked for one by a vendor (via their estate agent) before they'll accept your offer on a property. As a first time buyer, it'll generate confidence that your mortgage application will be accepted and the purchase will go through.

 

Top tip: See our Decision in Principle page for more information.

When do you make a formal mortgage application?

What paperwork do you need for the application process?

Next steps to buying your first home

Hopefully you’ve found our first time buyer’s guide to getting a mortgage useful, but if you do have any questions our team will be able to help you on your first time buyer mortgage journey. Please get in touch by visiting us in branch or giving us a call on 0800 834 312.

You can also find out more about the step-by-step process by checking out our steps to buying a house manual.