Becoming a homeowner for the first time is exciting, but can also be a little overwhelming – where do you start, what steps do you need to take? This blog takes you through the 5 easy steps to becoming a homeowner through Help to Buy…
1. First things first – what can you afford to buy?
You may already have an idea of the house you want to buy and the area you want to live in, but can you afford it? It’s useful to first work out what homes are in your price-range to avoid disappointment.
We always recommend speaking to an Independent Financial Advisor (IFA) who will go through your incomings and outgoings and work out what you can afford to pay back each month. You will then know what you can afford and how much you need to save and whether you need to improve your credit score.
Download our recommended IFA list.
2. Saving for a deposit
In order to buy your home you will need a deposit ready to pay when you exchange contracts on the property. Deposits can vary but with a Help to Buy Equity Loan you will need a minimum of 5%.
Saving for your deposit can be the hardest and longest part of buying your home so it’s important to take this into consideration. You will need to work out how much you can afford to save each month and stick to it. Setting up a specific savings account for your deposit will help you see how much you’re saving and encourage you to work towards your goal.
A Help to Buy: ISA account could also help. This is a savings account designed specifically to help first time buyers purchase a home. For every £200 you save, the Government top it up with £50, up to a maximum of £3000. So if you save £12,000 you will actually have a deposit of £15,000 with the Government bonus, meaning you won’t have to save as long.
Find out more about the Help to Buy: ISA.
3. Finding a home
There are plenty of property portals such as Rightmove and Zoopla that will help you with your property search, but did you know our website has the most Help to Buy and Shared Ownership properties across the North West? It’s updated by house builders daily so will always have the most up to date properties available.
As well as your online search, keep your eyes peeled for new developments offering Help to Buy being built in your area. Visit show homes and sign up for house builder newsletters as these always contain their newest developments, as well as any deals they’re offering to first time buyers.
Knowing what you want in a home can also speed up the process. Try and prioritise what is most important to you but don’t forget that this is your first home and you may need to compromise on some things!
4. Applying for Help to Buy
Once you have found the home you want to buy, you will then apply for Help to Buy. You will also need to appoint a solicitor at this point to act on your behalf.
The quickest and easiest way to apply for Help to Buy is online. Our video explains why…
Once we receive your application, it takes 4 working days to process. If you’re assessed as eligible you will receive an Authority to Proceed letter which means you can now apply for a mortgage.
5. Choosing your mortgage lender
If you have used an IFA they will apply for a mortgage on your behalf. If not, you will need to do this yourself. Make sure your lender knows that you need a Help to Buy mortgage as this means that there will be a second charge on the mortgage. Once you have received your full mortgage offer, your solicitor will then liaise with Help to Buy North West on the exchange of contracts and completion of your new home.
And that’s it! Buying a Help to Buy home in 5 easy steps – find out what you can afford, save for a deposit, find your dream home, apply for Help to Buy, choose your mortgage lender!
You can visit our Help & Advice section for more information or contact us on 0300 790 0570.