First Time Buyer

We know from experience that buying your first home can be a very scary process with so many decisions to make and so many unknowns especially in the current climate. With New Star Financial by your side, we can take the hassle out of the mortgage process by helping you to “get mortgage ready” and ensure you get your YES when needed!

Where Do I Start?

As a First Time Buyer, the first thing you need to do is find out how much you can borrow to buy your first home. The Central Bank of Ireland allow an individual to borrow a maximum of three and a half times their gross income.

This is where New Star come in to play as we will help you find that figure and give you a clear picture of how much you may be able to borrow based on your salary, savings and current financial situation by way of an in house confidential Mortgage Pre-Enquiry assessment. 

Once we have completed your assessment and you wish to proceed, we can then package up to 2 separate applications with the lenders of your choice. This will contain much of the same information that we already looked for. It will require you to gather supporting documentation (e.g. pay slips, bank statements) to back up what you have stated.

Once you’ve got an approval in principle, you’ll know the maximum loan amount available for your new home and then the house hunting fun begins.

When you’ve found the home of your dreams, your chosen lender will arrange for a valuation to be completed to check that the property is worth the amount you are paying for it.

Once the valuation and all of the relevant checks have been made, including confirmation that you can afford to repay the loan, your lender should then send out your loan offer. You will also need to apply for other products (which New Star can help you with if needed), such as suitable mortgage protection insurance and home insurance.

Your solicitor will check the legal documents relating to the ownership and use of the property. He or she will also make local authority and other searches to check whether there are any matters which may affect the value of the property.

Once your solicitor has completed all of the checks, you and your seller are ready to exchange contracts. This means signing your identical copies of the contract for sale, before the solicitors exchange them. This is when you pay your deposit through your solicitor. At this point, both you and the seller are legally bound to proceed with the transaction. If you pull out after exchanging contracts, your deposit is at risk.

What Types of Mortgage are there?

Lenders will usually offer first time buyers a standard repayment mortgage. That means you pay interest on the mortgage and repay capital over a period of time, usually 20 to 30 years. 

How much do I need for a deposit?

A 10% deposit is required for all purchases regardless of the purchase price. For example, if you are buying a property at €250,000, you will require a Total deposit of €25,000 plus legals and 1% stamp duty 

Will my outstanding loans affect the amount I can get?

When offering a mortgage, banks generally look at the borrower’s gross income and will also take into account existing loans. If you have a reasonable amount of personal debt, for specific purposes such as car finance, then this may not cause a problem. If possible, you should seek to be debt-free before you apply for your first mortgage. 

Are there extra costs involved?

There are some extra costs involved when getting a mortgage, some examples of these are as follows:

– stamp duty
– solicitor’s fees
– surveyor’s fee
– mortgage protection insurance
– building and contents insurance

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