It’s essential you know what you may be able to borrow before looking for your first home, so you’ll need to call us for an affordability check first.
If you’re saving for a deposit, then it’s worth considering the following options.
Online Cash Lifetime ISA
This is a savings account which can be opened by people between the age of 18 and 39 to save up to £4,000 tax-free each year. The government will pay a 25% bonus on your contributions, up to a maximum of £1,000 a year and it can be used to help you save for your first home.
Your Lifetime ISA allowance forms part of your overall £20,000 annual ISA allowance. If you withdraw before you reach 60 for any reason other than purchasing your first home, a government charge will apply and you will get back less than you put in. Find out more.
Help to Buy
Help to Buy is a government scheme designed to help if you’re saving for a deposit for your first home or to move up the property ladder. View our help to buy products. Help to Buy loans are only available if you meet the eligibility criteria and you're buying a new-build home.
Getting your deposit together
Once you've got your deposit together, you then need to get advice on the type of mortgage you can have, which tends to be one of the following three types:
- Fixed rate – These let you budget and protect against interest rate rises during the term the rate is fixed. But if external interest rates fall, you won’t benefit from this.
- Variable rate tracker – The monthly payments can go up or down. This means you can take advantage of low interest rates but there is a risk that rates may rise during the product period. If the product is a tracker, it will go up and down in line with the external rate it's tracking. Tracker mortgages may be subject to a floor, below which payments will not fall.
- Variable rate discount – Sometimes we offer mortgages with a discount off our own variable mortgage rates for a set period. (Your payments will increase if our variable interest rates rise, but a discount takes the pressure off by keeping them lower for a set time at the start). Our variable rate is set by us and is not linked to the Bank of England base rate.
You can obtain a Decision In Principle (DIP) over the phone, once you have found a property, and it only takes around ten minutes.
The amount we lend is based on an overall assessment of affordability, which takes into account your income, expenditure and the impact of possible future interest rate rises.
What you’ll need when you call us;
- Salary and employment details
- 2 years' accounts if self employed.
- Details of your current financial commitments and loans.
Getting a Decision in Principle