The First Time Buyer and the deposit, will I have to provide one...?

First Time Home Buying Guide - Page 5 of 11:

'So, I'm a first time buyer, will I have to provide a deposit on my mortgage?' you may well be asking yourself, and you may well be pleased to know that the answer is 'No, not necessarily!'.

Some Mortgage Lenders will consider advancing 100% mortgages to appropriate applicants. However, those borrowers who will generally qualify will be able to demonstrate stability of employment and residence, and whose financial track record has been conducted without fault.

For clarification, a mortgage deposit is the amount of money that you will pay upfront towards the price of the house. The balance is usually represented by mortgage funding. The size of the deposit is expressed as a percentage of the purchase price and will generally dictate the rate of interest that will be charged.

Some schemes have additional features that enable borrowing well in advance of 100% loan to value (LTV). These plans will advance up to 125% of the property value, subject to a maximum of £30,000. Although the additional funds can be used for any legal purpose, this type of mortgage product is ideal for those borrowers who may want to carry out some home improvements or a modernisation programme to their newly acquired property, whereas other borrowers find it to be a useful opportunity to refinance their existing debt, thereby just having one manageable payment each month.

Further resources and help for First Time Buyers regarding Deposits...

For more information on mortgage repayment types, please check out the following pages in our Mortgage Glossary.

So, hopefully we've managed to give you a bit of an idea about deposits and how you may not necessarily even need one!

You're probably wondering about your borrowing capacity now, and specifically how much you may be able to borrow as a first time buyer, so let's look at that next.

How much can I borrow for my first mortgage? NEXT ›

Enquire Online now, or call us today 08000 282 281 - our freephone lines are open 8am-10pm everyday! We'd love to hear from you!

The overall cost for comparison is 9.8% APR.
The actual rate available will depend upon your circumstances. Ask for a personalised illustration. APR variable and based on a usual case. Most customers are likely to receive a lower rate or the same rate as our overall cost for comparison rate - learn more about APR.

There are no upfront broker fees.
However, a fee may be charged on successful completion. An indication is that on conforming cases (straightforward applications with no or minimal adverse credit) a fee may be charged of up to 1% of the amount advanced, typically £795 and will depend on your circumstances.
For non-conforming cases (where case research and processing may be more complex due to adverse credit or unusual circumstances), a fee may be charged of up to 3% of the amount advanced, typically £1,995.

THINK CAREFULLY BEFORE
SECURING OTHER DEBTS AGAINST YOUR HOME.
YOUR HOME MAY BE REPOSSESSED
IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

Adding existing debt to your mortgage will increase the repayment term and overall cost.

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