First-Time Buyers Guide

Are you a first-time buyer feeling completely lost on where to start? You're ready to start your journey to purchasing your first home or you want to know what you need to do to get there but are overwhelmed? You’re not alone. So many people in the same situation as you will put off buying a property because they don’t understand or even know the process at all.

So, we’ve put together a short guide to help you understand your situation better and feel confident in taking that next step.

What to do if

YOU HAVE YOUR DEPOSIT READY AND ARE ACTIVELY LOOKING TO BUY

or
YOU ARE STILL SAVING AND WILL BE LOOKING TO BUY SOON
 

Understand and get your finances in order
One of the most challenging tasks you’ll face during your journey is saving for your deposit. Most people will find that sacrifices must be made and depending on your living situation at the time it can be extremely difficult to put money aside every month, especially with the cost of living having drastically increased in recent times. The good news is that this is only temporary and once you are in your first home it will feel well worth all the hard work.

Many underestimate just how much cost comes with purchasing a house and the unexpected fees that come up along the way. Knowing your finances, what to expect and when can help make the process a lot smoother and less stressful for yourself. The costs to consider are;

•  Deposit
•  Legal fees (surveyors/solicitors/conveyancers)
• Land Transaction Tax (Wales)
• Mortgage Fees
• Works that need to be done (plastering/painting/carpeting etc.)
• Furnishing (beds/sofas/dining table etc.)

The more of a deposit you have the better as you are likely to be offered lower mortgage rates and have less of a loan to pay off over the years. Most people aim for 10% or even 20% however this can take much longer.

The Welsh Government have initiatives available to first-time buyers such as the Help To Buy Scheme and Lifetime ISA. Not everyone is eligible for these but it’s certainly worth checking if you fall into either of the categories. Find more information on eligibility here.

Get a Mortgage Advisor
Seeking advice from a mortgage advisor in the early stages will be incredibly helpful for you to understand the financial aspect of a mortgage and your own personal situation too. Even if you feel like you are nowhere near ready to the offer stage, a mortgage advisor will be able to tell you what goals you need to set to qualify for a mortgage. You don’t want to find yourself in the frustrating situation where the perfect home comes on the market, you have your deposit ready but you can’t get a mortgage due to reasons you were unaware of and that could have been rectified in the months leading up to that moment.

There are many factors that could affect your application and the rates you are offered as a first-time buyer and you need to bear in mind that you need to be sensible with your finances for months if not years before buying a house. The checks that lenders make are intrusive and they will look at your spending habits closely. Here are a few examples to be aware of;

• You don’t have any credit history - Banks want to know that you are reliable in paying something back each month and first-time buyers often don’t have this to show. You may be advised to take out a credit card to pay for fuel during the month, clearing it at the end of the month.  
• Your credit score is too low – Sign up to one of the credit score checkers such as Experian or Clear Score so you can keep on top of anything that may be affecting it. This can be as little as not being enrolled on the Electra roll to having missed one payment.
• Your newly self-employed – Most banks require you show at least 3 years of payslips before they can take your business earnings into consideration.
• You’ve got a new job – Most banks require you to show at least 6 months of payslips if you have recently been employed by a new company and written confirmation from them to confirm you are in permanent, full-time employment.
• You’re not working enough hours /earning enough – You may be advised to up your working hours or look for a job that is higher paying,  
• You have outstanding debt – clearing any debt such as overdrafts will improve your application. Student loans are ok.

We highly recommend 75point3, a local company offering financial advice, with a personal service, which is comprehensive and professional and takes the stress out of the process. Find more information here.

Register yourself with local agents
Buyers tend to only get in touch with an agent when they have seen a property online or a “for sale” board outside of a property they are interested in. But registering your details with as many local agents right away can benefit you in many ways.

Even if you feel like the right property isn’t currently online for you, agents will store your details and preferences on their system and will keep you up to date on new listings that come to market that match your criteria.  They’ll let you know of any price reductions on anything you’ve had your eye on but it didn’t quite fall into your price range previously, ensuring your always in the know and don’t miss your potential dream home.

Familiar yourself with the market
I’m sure we’ve all had a scroll through property listing sites when we’re not looking to purchase a property, we all like a bit of a nosey. But here’s why this is a good thing and why you should do this along with attending physical appointments more when you are ready or almost ready to make your first purchase.

• It famiiarises you with the property market.
• It gives you an idea of what you can get for your budget.
• It allows you to realise what you like and don’t like in a property.
• Many websites have virtual tours so you can view at a time that is convenient for you without having to feel any pressure to give feedback.

WHAT TO DO ONCE YOU HAVE FOUND YOUR DREAM HOME

1. Book a second viewing.
2. Put in a reasonable offer. Your agent will advise you at this stage.
3. Once your offer is accepted contact your mortgage adviser so that they can issue the mortgage in principle and have it sent over to the agents selling the property. Some people do this before they start viewing so they know exactly how much they are able to borrow and aren’t disappointed if they find a house they can’t afford.
4. If your offer is rejected, consider whether increasing your offer is worth it and if it is within your financial means. Again, discuss this with your agent.
5. The lender will instruct a surveyor to carry out the survey. This is just to check that the bank is happy to lend you the money on the property you have offered on. If you have offered £250,00 on a property that is then valued at £200,000, the lender will reduce the amount they are willing to lend you.
6. You must appoint a solicitor to deal with the conveyancing (don’t forget to fill in all the paperwork that the solicitors request off you) They will also request a payment to send for the searches. (Environmental search, Water search, Local search)
7. Once your solicitor receives all the searches, they will then send some enquiries over to the seller's solicitor to answer.
8. Once everyone is satisfied with the answers they will aim to exchange. Make sure you carefully read the contracts with a solicitor and that you understand every point as at this stage you and the seller are legally committed to the sale. You are legally responsible for the property once you have signed the contracts so it is important to take out building insurance immediately.
9. Your solicitor will request your deposit payment and arrange a completion date.
10. When your completion date arrives, the lender will send the remaining amount you need to purchase the property over to your solicitor, who will then send it to the seller.
11. Your solicitor will register the ownership change, request payment for them and payment for Land Transaction Tax (Wales).
12. When all of the payments have been confirmed you are then able to pick up your keys and you are now a homeowner.

(NOTE: the process usually takes 12 weeks as a minimum, with many sales exceeding this due to delays with surveyors' diaries, searches, etc.)
 

ADVICE / TIPS FROM OUR SALES NEGOTIATORS

• Be prepared for delays, it can be a LONG process. Buying a house does not happen overnight and you can often be faced with several, unexpected issues along the way, many being out of your control. Try not be disheartened if you do face any of these, the journey will be worth the wait.
• Don’t be afraid or embarrassed to ask agents/mortgage advisors/solicitors as many questions as you need to. They are there to help you throughout your purchase and understand that you will need
• Book a second viewing on a property you think you may really like. It can be quite overwhelming during your first viewing you may not take it all in, especially if you are viewing multiple properties.
• Avoid taking out any finance or other loans leading up to buying the house.

Purchasing a home for most of us is the biggest purchase we will make during our lifetime and will be an excited and proud moment. So, it must be done right and not rushed. Feeling confused or lost is completely normal and if you still feel like you have any questions our dedicated team are always on the other side of the phone to help you.

Bangor- 01248 35 35 44
Llangefni – 01248 72 33 22
Caernarfon – 01286 67 7774
Llandudno - 01492 88 44 84 
Colwyn Bay – 01492 88 44 84