Thinking of buying your first home? That's super exciting!
It might feel a bit scary too, and that’s totally normal. Buying a house is a big step, but it doesn’t have to be confusing or stressful.
If you’re looking for help, this first-time buyer's guide breaks things down in a simple way. It’ll show you your options and go over the most important things to think about when getting your first home.
We're here to help first-time buyers feel confident as they begin their journey onto the property ladder. Chatting with a mortgage adviser early on can give you an idea of how much you can borrow and what you need to save.
It's our mission to help Members buy their home, even if their situation is unusual; so come chat to us for free to get yourself mortgage ready!
The size of your deposit decides how much of a mortgage loan you’ll need. For most first-time buyers, you need a deposit of at least 5% of the price of the property you want to buy.
The bigger the deposit you have, the lower rates you'll have access to.
We know that many first-time buyers need help from parents or close relatives, so gifted deposits are accepted. Alternatively, our Head Start mortgage uses parental support without them gifting any money.
You’ve worked out how much you can borrow and have your deposit. Now it's time to get a Decision in Principle (DIP) and start looking at properties. A DIP is an early indication of how much we may be able to lend you for a mortgage. It’s free to get a DIP, there is no obligation to follow through and it will not affect your credit score. It’s common to need a DIP in place before an estate agent will submit your offer to a seller. Once you’ve found a property you like, and had your offer accepted, you’ll be ready for the next step - applying for a mortgage.
What happens when you apply for a mortgage?
When you apply for a mortgage with us, we'll ask to see documents to help confirm information about you, and to check that you’re able to afford your monthly mortgage payments.
What we’ll ask from you
We’ll ask for financial documents like bank statements, payslips and HM Revenue and Customs (HMRC) documents if you’re self-employed.
Credit checks
We’ll run a full credit check. At this stage, because this is a formal mortgage loan application, it will leave a footprint on your credit file. It would be wise to look at your spending and credit record as we'll ask you to provide three months of bank statements.
Legal/conveyancer fees
If you're making an offer on a property in England or Wales, you’ll be asked to provide your conveyancer's details. A conveyancer handles all of the legal work required to complete the purchase of your home.
Remember to get a quote for conveyancing first before appointing anyone.
Mortgage valuation
We’ll do a mortgage valuation as part of your application with us. They're to check the property you want to buy is worth the price you're going to pay.
Our underwriters will only instruct a valuation after they have agreed your application in principle. You can request a valuation to be done sooner than this; however, you will be doing so at your own financial risk. You may want to consider the cost of a mortgage valuation into your budget.
Once you've received your mortgage offer, you’re almost ready for the mortgage term to begin and the house is then yours.
There will be contract paperwork from us that you’ll need to read, check everything is correct and then sign.
You will need to have building insurance in place from your completion date. It covers you for damage to your home. At the end of your mortgage application, we’ll give you the option to get a quote for home insurance, but you can also look to get a quote from another provider if you prefer.
When the legal work is finished and contracts are signed, your solicitor will exchange them with the seller’s solicitor. They will then pay your deposit and agree a completion date. This may cost a fee from your solicitor.
On completion day, the seller of your home receives the money from your solicitor, and you'll get the keys to your new home!
Your first payment will usually be more than your regular monthly payment. This is because it includes interest for the days between the date you moved in and the end of that month, plus your standard monthly payment for the following month.
Now you're familiar with how they work, head over to our products page and continue finding out if a first-time buyer mortgage with the Vernon is right for you.
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