Your first home - How much to budget

Perhaps you have been saving hard for your deposit and related purchase costs. Whatever your circumstances, there is no way of avoiding making some financial commitment unless you have very generous family or friends!

If you would prefer to talk to a consultant about deposits or related costs, call us free on 0800 298 5136

The majority of lenders expect borrowers to make a financial commitment in the form of a deposit. Generally, lenders expect borrowers to have at least 5% of the purchase price or value (whichever is the lower) available to put down as a deposit before they will consider funding the balance by way of a mortgage. Unfortunately for some First Time Buyers, property prices in some regions have been increasing rapidly for some time and it has been difficult for some to maintain their savings at the same pace. The good news is that some lenders will consider lending 100% or more of the purchase price or value (whichever is the lower) provided you are prepared to pay a slightly higher interest rate to offset the greater risk.

Local Housing Association schemes like the Shared Ownership Scheme are still very popular, despite the waiting lists, as a means to getting on to the housing ladder. A number of lenders embrace the Shared Ownership Scheme. More recently, we have seen friends and family purchase property in joint names to share the initial costs and subsequent mortgage repayments.

When you purchase your first home, it's likely that you will engage the services of many third parties who will require payment for their services in addition to a deposit.