Are you buying your own home for the first time? Itandrsquo;s a serious and ultimately rewarding first step onto the home-ownership ladder. By definition, youandrsquo;ll only do it once andndash; so itandrsquo;s important to get it right. Donandrsquo;t let that put you off, though. As a first-time buyer, youandrsquo;ve a lot going for you - youandrsquo;re an attractive proposition!
* As a first-time buyer you are attractive to anyone selling a home because youandrsquo;re not in a long andldquo;chainandrdquo; andndash; youandrsquo;re not one of a string of other people all waiting on a sale in a chain of events that have to happen on time;
* As a first-time buyer, mortgage lenders will be keen to secure your business;
* As a first-time buyer, youandrsquo;ll be entering a market that has some of the lowest lending rates of the past three decades or so.
Armed with the confidence that youandrsquo;ll be quite a catch for many of the people involved in buying your first home, therefore, you can take a serious look at what itandrsquo;s going to cost you. Can you afford it? Of course, youandrsquo;ll need to take all the costs into account. Although the list might seem quite daunting, itandrsquo;s important to remember that many of these will be the expenses youandrsquo;d face whether you take the plunge and buy, or whether youandrsquo;d be simply renting anyway.
Until the andlsquo;credit crunchandrsquo;, first time buyers could apply for 100% mortgages. However, at the end of February 2008, many high street banks and lenders withdrew this product for new borrowers amid fears of homeowners quickly falling in to a negative equity situation. Now, you will need a deposit which can typically be anything to 5-10 per cent of the purchase price.
You should bear in mind that the bigger the deposit you have, the more mortgage options will be open to you, as you will need to borrow less money from a lender.
On top of the deposit, there will be many additional costs. Letandrsquo;s take a look at some of them:
* What mortgage repayments can you afford? How will these compare with the monthly rent youandrsquo;d otherwise be paying?
* Insurance to cover your mortgage repayments in the event of your falling sick or losing your job andndash; itandrsquo;s called mortgage payment protection insurance.
* Life assurance andndash; money that would be paid to your dependents in the event of your death, so that they can still pay off the mortgage and keep your home.
* Youandrsquo;ll also need to insure the buildings and contents andndash; all the things you keep in your new home, as well as the bricks and mortar, to protect them against theft, fire, flood or other unforeseen events.
* Perhaps youandrsquo;ll have to pay a ground rent or management or service charges, especially if youandrsquo;re buying a flat or an apartment.
* Finally, there are all those everyday costs that youandrsquo;d be paying wherever you live andndash; things like council tax, water, gas, telephone, electricity, etc.
Your home is likely to be the most important and most expensive thing youandrsquo;ll ever own, so of course there will be a number of additional fees associated with its formal purchase. Some of these additional fees and expenses are likely to include:
* Fees charged by a solicitor or licensed conveyancer
* The costs of conducting an independent survey of the property
* Any fees charged for arranging your mortgage
* The fee paid for inscribing your purchase of the property in the Land Registry.
* Stamp Duty
If youandrsquo;ve worked your way carefully through some of the broad budget headings above, youandrsquo;ll have a pretty good idea of just what your present and future circumstances are likely to allow. Even if the costs initially seem to put home-ownership beyond your reach, think again and remember that there are various plans run by the government to help people make that first step onto the property ladder - especially if your job makes you a andldquo;key workerandrdquo;. The two plans are:
* The Key Worker Living programme andndash; helping those who work to deliver essential public services; and
* HomeBuy andndash; for those who cannot yet afford to buy a home outright.
Letandrsquo;s just go over the main points againandhellip;.
* Costs. Buying your first - or second or third home for that matter - involves lots of costs. It isnandrsquo;t just the deposit you need to find, but money for legal fees, insurances, plus furnishings once you are in there! Be sure that you can really afford to take the plunge.
* See if you would be eligible for a Key Worker Living Programme or similar to help keep the cost of having a roof over your head down
* Donandrsquo;t forget that youandrsquo;ll need insurances if you do get your foot on the property ladder. Life, household and mortgage payment protection insurance should all be looked at carefully and shopped around for
* And finally, shop around! At Confused.com we can do all the hard work for you. Simply click on the relevant search tool and weandrsquo;ll show you a selection of products, giving you the freedom to choose the right one for you.

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Article Submitted By: Kate Tee
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