The Benefits for First Time Buyer Mortgages.
First time buyer mortgages carry some additional benefits other mortgages do not. The reason for this is first time buyer mortgages strive to make home ownership as easy as possible the first time around. Of course there are benefits and drawbacks to all types of mortgages as well and first time home buyers should evaluate the pluses and minuses before making a decision on a mortgage.
One of the best benefits of first time buyer mortgages is that 100% of the home’s value may be financed in some cases eliminating the need for a deposit.
Since saving money for a deposit is often the most difficult aspect of buying a first home this benefit makes it easy for couples to become homeowners quickly and easily. Also, frequently first time buyers are eligible for different discounts in order to keep their monthly payments as low and as manageable as possible.
Frequently services are included as well including free valuations and the like. Of course, this differs from lending institution to lending institution, but it is frequently an option. Also, one favored benefit for first time buyer mortgages is that upon completion of the mortgage a certain percentage of cash back is given to the couple in order to help with home improvements or repairs.
While first time buyer mortgages sound like a sweet deal and they can be, there are some definite drawbacks that exist as well.
Since first time buyers are just that, first time buyers, there are some drawbacks that exist to first time buyer mortgages. For example, first time buyers may only be approved for higher interest rates meaning the actual price of their home costs more. Since the interest rate is usually higher many couples choose to pay off their home early.
However, many lending institutions have caught onto this and there are penalties and fees that apply to couples paying off the mortgage early. There are also minimum loan amounts that generally apply to first time buyer mortgages as well. Of course, these vary from lending institution to lending institution and should be discussed with the loan officer who is helping you with your loan application.
If you are a first time buyer there are first time buyer mortgages that are worth your while. However, you will need to do some research in order to find the bank or lending institution with the most favorable interest rates, benefits and rules governing the first time buyer mortgage.
If you do not find a mortgage that seems to match your needs and/or budget remember that banks and lending institutions can negotiate a bit when it comes to interest rates as well as other benefits and drawbacks affecting your mortgage.
So, don’t be afraid to ask for what you want. You just might be surprised and be approved for the perfect first time buyer mortgage for you.
