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Applying for a Mortgage in Perth, Scotland

Buying a home for the first time is currently more difficult than it has been for decades for a number of reasons. However, that doesn’t mean that you won’t be able to buy your dream home. With this guide for first time buyers, you will be able to get closer to owning your dream property in Perth. Follow the steps, take care, and you are much more likely to be successful.

Firstly consider a budget

There is little point looking at property if you don’t know what your budget is. First time buyers need to think about the funds that they have available, and the amount that they would be able to borrow to top up their funds. From there, the property search can begin.

Are you eligible to get a mortgage?

There are certain groups of people who will struggle to get a mortgage, including those with no deposit, the unemployed, or those with a low credit score. Lenders need to ensure that they’re not taking too much of a risk when granting your mortgage – and the financially stable are the lower risk groups to consider.

Understand how mortgages work

A mortgage is a loan – but it is almost certainly the largest and most daunting loan you will ever take out. However, getting the right product for you is important. There are two major mortgage types that you can choose from: repayment mortgages and interest only mortgages.

A repayment mortgage is just that – your monthly payments will include both the loan amount and any interest, so at the end of your mortgage term you will have paid the full amount off. An interest only mortgage will only ask you to pay the interest that has built up, meaning that you will need another investment plan over the course of the mortgage term to ensure that you can pay back the capital at the end.

You will be asked to pay a monthly amount – which can vary depending on current interest rates – and when the payments are completed the property is yours outright. Some mortgages will give you the option to make extra repayments to pay back the loan faster, however some will penalise you for this.

Viewing a property

Caution is key when viewing a property and, although it might be exciting, it is vital that the property is perfect for you. Checking things such as the size of the bedrooms and the views from the windows might seem obvious, but other things need to be taken into account such as potential for flooding, parking, the situation with neighbours and even the positioning of plug sockets in the rooms. Everyone will have different preferences with regards to what they consider to be positive or negative, and it is important to get as much information and knowledge about the property as possible. It can help to take somebody with you with knowledge about electrics or plumbing.

Surveys

If you’re getting a mortgage, many lenders insist on a survey and valuation on the property that is being bought. This is to ensure that the property is worth the amount that you’re considering paying, and that there aren’t any issues with it that could cause issues in the future. A solicitor will be able to help with this stage of the process.

Putting in an offer

There are relatively few areas in the country where property regularly sells for more than the asking price – usually there is room for manoeuvre and you can put in an offer for a lower price. You can place this offer through the agent, who will then inform the sellers and let you know if they accept it or not. If they do decide to accept, the legal process can begin and, all being well, you will have yourself a home.

Be aware that buying a home – particularly if you are stuck in a chain, can be a long and costly process. However, by following the steps in this guide and being clued up about your options, you should find that it is more straightforward than you thought.

Get in touch with us today and we will put you through to a local mortgage broker that will be able to assist you with any enquiries.