Agreed to buy a house from a friend of mine.
It is my first mortgage and have a 10% deposit any suggestion on lenders various
people have used?

 

Friend or not, check that your paying a realistic price, ie approx 2004 levels.

 

Not sure a 10% deposit will be enough TBH. I'm a first time buyer and managed to get a mortgage with the Halifax with a 20% deposit, some lenders were asking for up to 35% deposit.
My advice to you would be go and see an independant financial advisor, they'll have a range of mortgages they can look at to see what's best for you.

 

+1

 

+2

I've just bought my first house. For way less than it sold for in 2004 . Everywhere i looked at were asking for at least 20% deposit.

A good IFA shouldn't cost you anything. They have to tell you how much commision they get paid. Mine was about £200, which the lender pays to them. It was still the same price whether i went direct to the lender or via my IFA.

 

I have looked at mortgages and im ok with a 10% deposit as im only borrowing
1.2 times my salary.

House is under priced as he wants a quick sale

 

There are quite a few variables but have a look at Britannia for 90% LTV mortgages.

If you can find someone (parents) to go guarantor on another 10%, Lloyds might offer you the rates for 80% LTV (look the site for details)

Your main concern right now is how long you want your special deal to run for. Say you go for 3 year fixed. In 3 years time, interest rates will be right back up there (and no double figures won't happen) however who knows where they will be in 5 years but suffice to say they won't be where they are now.

Be careful with trackers and discounts. If its base plus 3% for instance, when interest rates get up to 6% (any further and you'll have people defaulting even quick than now), you'll be on 9%. Fixed is probably safest right now and if you can afford it go for 5 years for nothing but peace of mind.

NB - its a mate selling yes? not a relative?

HTH

 

As above really. You're not going to get a good deal unless you've got at least 25% to stump up. There are deals with lower LTV but the arrangement fees on most of them are hideous. They get you one way or another.

It's ironic really that the market has fallen to a point where FTBs should be thinking about taking the plunge but it's nigh on impossible to get a mortgage. The market needs the FTBs to stop it stagnating.

If I were in you situation I'd save like hell for the next year or so, live like a hermit if you have to, and then with a hefty deposit you'll be primed to take advantage of the market at the bottom of the cycle

 

You'll do well to find an independent IFA - most have preferred providers as they get kick-backs on the deal you do. In theory you ought to be able to get a deal cheaper direct from a supplier but few are bright enough to offer it. Have a hunt on money supermarket etc - beware getting quotes for your real data as every time you ask for a personal quote it puts a flag on your credit history. Too many in a short period makes you look risky (providers assume that you have been rejected elsewhere) which then puts up the price / terms of what you'll be offered.

Good luck

Gordo

 

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