How can first-time buyers obtain a mortgage?

First-time buyers have been given advice on how to obtain a mortgage by Ben Wilkie, magazine editor of What Mortgage.

Shop around

He told those looking to obtain a mortgage to shop around for the best deal rather than just applying for one with the bank that they hold their current account with.

Mr Wilkie said: "Look at the different options available, although the research takes quite a long time there are schemes available where you don't have to pay much more than five per cent, or you can do shared ownership."

Brits who want to shop around for a mortgage can do so using a price comparison site, such as MoneyExpert.com, as this will list all the types available and the benefits of each.

Look into government schemes

"There are also government schemes where you can get loans that are there to help you buy your first home," he added.

This could include the new scheme launched by the government during the Budget on March 22nd.

Chancellor George Osborne announced that first-time buyers earning less than £65,000 a year who want to buy a new-build home can borrow ten per cent of the deposit from the government and the home-builder respectively.

This means that first-time buyers will only have to save five per cent for a deposit and they can pay off the money they borrowed in the form of a loan.

Pay off outstanding debts

First-time buyers have also been advised to pay off any outstanding debts that they may have, including credit card debt.

That is because lenders will look into how much money the person has borrowed before giving them a mortgage.

If they have a high amount of debt they may struggle to obtain a substantial mortgage, Mr Wilkie claimed.
 

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