First Time Buyers Guide– Residential Mortgage

First Time Buyers Guide– Residential Mortgage

First Time Buyers Guide–
Residential Mortgage


  • 2 bedroom apartment for sale £330k (Home buy)
  • Colindale Gardens,
    Colindale Avenue, Colindale, London, NW9
  • 2 bedroom apartment for
  • Canaletto Court,
    Neasden Lane, London, NW10
  • Shares from £93,750
    (25% share price of £375,000 for a two bedroom home). (shared ownership)

London Help to Buy

This is an extension of the existing Help to Buy
equity loan scheme to help Londoners get on the property ladder.

Who can do it? Anyone
wanting to buy in London with a 5% deposit.

House price: Properties in
Greater London costing up to £600,000.

Property type: New build.

Government lends you up to 20-40% of the property
value (interest-free for the first five
This substantially reduces the monthly costs in the first five
years and would give access to cheaper mortgage, as you only need to borrow 60%
of the value from the lender.

Help to Buy: Shared ownership

Who can do it?

  • Non-homeowners, including
    first-time buyers and those who previously owned a home, who earn £80,000 a
    year or less (thresholds are up to £90,000 in London).
  • You’ll need to have enough
    savings to cover a 10% deposit of the share you’re buying, and to cover moving
    costs, stamp duty, solicitors’ fees, etc. You’ll also need to find a mortgage
    lender that is willing to lend on shared ownership properties.

House price: Any.

Image result for shared ownership

Options to Buy

  1. Shared ownership

Property £200,000,

Buy: a 25% share (75%
owned by a housing association). That works out as:

Housing association share = £150,000

Your share = £50,000

Your deposit = £5,000 (10% of the value of your share)

Mortgage required = £45,000

You pay subsidised rent (and usually a service charge) on the share you
don’t own, which will be less than the market value. If subsidised rent on the
property is £100/week, but you own a 25% share, you’d pay £75/week.

Mortgage fees include:

Stamp duty, insurance, service charge. mortgage broker fees,
adviser fees, valuation fees, arrangement fees and more.

  • 1ST Time Buyer regular outright purchase

Property: £350,000

Deposit: 40k

Mortgage: 25yrs

Interest: 3%

Monthly payment: £1.5K to £2K

3.      Help
to Buy Equity loans

Deposit: 5% of the sale price

government lends you up to 20% of the sale price.

You borrow the rest (up to 75%) from a mortgage lender, on a repayment basis

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