If you are moving abroad to the United Kingdom and want to purchase a home as opposed to renting there are a variety of options for a first time home buyer. First time home buyer special financing is not limited to British citizens either. Even as a non citizen or non resident of the United Kingdom you will be able to qualify for some of the first time hoe buyer special financing options. You may notice that the special offers in the United Kingdom are not offered in your home country so it is important to know what you are entitled to in the United Kingdom so that you do not end up paying more than you need to for your new home. It is advisable to speak with a specialist mortgage broker if you are looking to purchase a property in the UK to move to. Many offer a free service and can help you through the whole process
If you are recently out of college and have good job prospects you may qualify for a special graduate and professional mortgage for young people. This type of mortgage will allow you to borrow up to five times your annual salary. In some instances you may even qualify for a 100 percent or 125 percent mortgage. The Britannia Building Society also backs a Graduate Network Scheme that you may qualify for as well called Share to Buy which is a joint mortgage for young professionals.
You may be interested in a self certification mortgage which is a mortgage that does not require you to prove your income. You may want to look into this if you are self employed or if you work on commission or some other type of employment that means your income fluctuates. Remember though that if you purposely lie about your income it is considered to be fraud and there are custodial sentences for offenders.
If you have friends or relatives you can all pool your resources and buy together if you want. Typically two to four people go in together on a home. Share to Buy offers a program for co-buyers where each person’s share of ownership is in direct relation to the deposit that they made and the remaining payments on the home. The percentage of the home that each person own is listed on the title deed and each buyer is listed as a tenant in common. The downfall of this is that if one person wants to sell you have the option of buying them out but if you can’t then the property must be sold.
A common thing in the UK is to obtain a guarantor for your mortgage
Typically young professionals use their parents to guarantee the mortgage payments. Most banks require a down payment of 25 percent to do this type of mortgage though. And the guarantor will need to have 30 percent equity in their own home. Guarantors are able to be released once the mortgage holder is making enough to qualify for the loan.
Housing associations and trusts offer shared ownership as an option to potential homeowners. The way that this works is that a non profit association helps low income earners such as teachers buy a home by buying a portion of the property and paying rent on the rest. Once you can afford it you can increase your share of ownership. They also offer another scheme called a starter home scheme where you can borrow up to 30 percent of a home up to a max amount of GBP 35,000. These loans are interest free and do not have to be repaid until you sell your home, as you are not expected to live in it forever as it is a starter home intended to get you into something else.
Unlike in the United States where rental income is taxed, you can take in a lodger in your home tax free if the rent is no more than GBP 4,250 per year. This is another great way for expatriates to save some money on their mortgages.