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Mortgages
Purchasing your first home is an exciting milestone, but it can feel overwhelming. That’s why starting with the right advice is essential. With numerous mortgage products available, it’s crucial to find the one that suits your needs best.
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YOUR HOME MAY BE REPOSSSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
Here’s everything you need to know:
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​A Guide for First Time Buyers
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1. What Is a First-Time Buyer Mortgage?
A first-time buyer mortgage is a loan tailored for people purchasing their first home. Many lenders offer exclusive deals or incentives, such as lower deposit requirements or cashback.
2. How Much Deposit Do You Need?
The minimum deposit is typically 5% of the property value, but the more you save, the better the interest rates you can access. Example: For a £200,000 property 5% deposit = £10,000 or 10% deposit = £20,000
3. How Much Can You Borrow?
Lenders usually lend up to 4-5.5 times your annual income. Example: If you earn £30,000 a year, you could borrow £120,000–£135,000. Joint applications can increase borrowing potential.
4. Types of Mortgages for First-Time Buyers
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Fixed-Rate Mortgage: Interest rate stays the same for 2, 5, or 10 years. Offers predictable payments.
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Variable-Rate Mortgage: Interest rate can change, impacting your monthly payments. Includes tracker or discounted rates.
5. Help for First-Time Buyers
The UK offers several schemes to assist first-time buyers:
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Shared Ownership: Buy a percentage (25%-75%) of a property and pay rent on the rest. You can increase your ownership share over time.
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First Homes Scheme: Offers discounts on new-build properties for eligible first-time buyers.
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95% Mortgage Guarantee Scheme: Encourages lenders to offer 95% LTV mortgages, meaning you only need a 5% deposit.
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100% Mortgage: A recent initiative To take advantage of this type of scheme you need to have rented for at least the last twelve months and show that you have a good track record of paying the rent regularly.
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Joint Borrower Sole Proprietor: This is where a relative joins you on the mortgage. Most commonly this takes the form of a parent helping a child, boosting your borrowing power to enable you to get the property you want.
6. Costs to Budget For
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Stamp Duty: No Stamp Duty on properties up to £425,000 (for purchases under £625,000), but this is changing on 1st April to no stamp duty up to £300,000.
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Valuation Fee: £0–£600 (depending on the lender).
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Solicitor/Conveyancer Fees: £800–£2,500.
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Survey Costs: £300–£1,500 (depending on the survey type).
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Broker Fees: If you use a mortgage broker, fees range from £0 to £500.
7. Agreement in Principle (AIP)
Before house-hunting, get an AIP from a lender. It’s a document that shows how much a lender might let you borrow.
8. Steps to Get Your First Mortgage​​​​​​​
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Home Mover
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Selling and buying a property has the potential to be one of life’s most stressful events and if you have already been through the first time buyer process, you will have a good understanding of this. Nonetheless, Performance Mortgages can guide you through to completion.
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We will look at the options of both staying with your current lender or moving to a new one to take advantage of lower rates, larger loans or a lender that accommodates your situation.
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When you are ready to move forward with your mortgage application, we will manage the whole process for you, liaising with your lender, solicitor and estate agent, so you can take it easy and start imagining how you’ll set up your furniture in your new home! ​​​
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Remortgages
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Your existing mortgage deal may be coming to an end and you’re about to move onto the lenders standard variable rate which could result in an increase in your monthly mortgage payments.
Remortgaging before your term ends could potentially save you money by switching to another deal or another lender. There are plenty of reasons why you might want to consider a remortgage, perhaps you want to cover the cost of home improvements or need to pay off expensive debts.
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Performance Mortgages will take the time to understand your individual situation before recommending the right product for you.
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Complex Income & Self-Employed Mortgages
You are unique therefore require a lender who would understand your situation. If your income is complex (for example, made up from different elements) or your occupation is unique, choosing the right lender is usually more difficult.
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Lenders need a clear idea of how your income is made up, how regularly received, who will pay it, how long it is expected to continue at the current amount and so on.
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Lenders assess the income of self-employed people in many different ways. Some will take an average of salary and dividends over the last two years whereas others may be more interested in the latest year and the overall profits of the business.
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Examples of unique occupation and self employment types:
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Professional Sportspeople
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Actors
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Comedians
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Artists / Musicians
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Journalists / Television Presenters
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Online influencers
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Limited company directors with shareholding above 20%
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Limited liability partnership
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Sole traders and partnerships
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Day rate contractors via limited companies or umbrella companies
Performance Mortgages will take the time to understand your income to then approach the lender that’s best placed to help you.
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Buy-to-Let/Let to buy
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A buy-to-let (BTL) mortgage is designed for individuals purchasing property to rent out rather than live in. It differs from residential mortgages in terms of criteria, costs, and tax implications.
How do buy-to-let mortgages differ from residential mortgages?
Interest rates are usually higher on buy-to-let mortgages compared to residential.
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Whereas for residential mortgages your deposit could be as little as 5% of the property value you will have to pay generally around 25% for a buy-to-let mortgage.
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Normally, many lenders have a ‘no minimum income’ requirement. However, there are some lenders that require a minimum income, for example £25,000 or possibly more for a first-time buyer or portfolio landlord.
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We can help you arrange a bespoke buy-to-let solution that’s tailored to you.
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MOST BUY-TO-LET MORTGAGES ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.
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Bridging Loans
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We can help you bridge the gap with short term finance. Bridging loans are ideal for bridging the gap between the purchase of a property and the securement of other funds e.g. via a mortgage or from the sale of a property.
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A bridging loan can be used to secure fast finance due to a tight deadline or to finance a property that would not get a standard mortgage as it requires refurbishment.
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Performance Mortgages will ensure the product is right for you if you’re unable to find suitable finance using a conventional mortgage.
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Contact
Call us
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Email us
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Address
Hankley, Middle Hill, Englefield Green, TW20 0JS
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Legal
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
Performance Mortgages Limited is an Appointed Representative of PRIMIS Mortgage Network, a trading name of First Complete Ltd. First Complete Ltd is authorised and regulated by the Financial Conduct Authority. FCA register number 1024696.
Registered in England & Wales no.16072295, registered office 3rd Floor, 21 Perrymount Road, Haywards Heath, West Sussex, RH16 3TP.​
WE DO NOT CHARGE any BROKER or SERVICE FEES.
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The guidance and/or information contained within the website is subject to UK regulatory regime and is therefore targeted at consumers based in the UK.
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