Virgin Money customers The Coyles tell their story
Buying her first home was a real family affair for Emma Coyle, 28, who moved into the Manchester flat in May 2013. And as we have advised in ‘Our simple guide to buying a property’, Emma found doing her homework was the key to snatching up her two bedroom Victorian conversion at a price that was right for her.
Making the first move
Emma, a clothing designer, had been renting for about six years when she decided the time was right to think about buying a home. She said: “I was fed up of effectively paying other people’s mortgages, but like most people my age, I was concerned about whether buying was even an option for me.”
Emma looked into various schemes put in place to help first time buyers, but ultimately decided to wait a little longer to save a bigger deposit.
She explained: “That was about three years ago and all the schemes I looked into seemed quite restrictive. Then about a year ago, my circumstances changed and I found myself staying with a friend, so my rent was cheaper.
“I was able to pay off my debts more quickly, and had time to look at properties in my own time, without the pressure of a formal tenancy agreement. So I started looking around at properties to get a feel for what I liked. I knew it would come down to what I could afford, but I wanted an investment for my future too. So, I stayed away from new build properties and looked for those with a bit of character.
“Knowing it’s the right property was the most difficult thing about the whole process as there was so much to consider.”
Choosing a mortgage
While Emma focused on the property side of her search, her dad Barrie, 53, looked at the mortgage market. And to help Emma further, Barrie and his wife Michele, also 53, decided to release some capital from their own home in South Tyneside to bolster Emma’s deposit monies.
Barrie said: “It was always our plan to help Emma get on the property ladder somehow. She had moved around Manchester a lot since relocating there for work after university, so we wanted to invest in her future by helping her put roots down.”
By remortgaging their own home, Emma’s parents helped her to lower her Loan-to-Value ratio, or LTV. This is the amount of borrowing taken out to buy a home, versus the percentage of the property owned by the mortgage-holder. An 80 per cent LTV means 80 per cent of its value has been borrowed using a mortgage.
Once she knew how much she had available, Emma wanted to make sure she didn’t pay over the odds in terms of her mortgage. The family checked with an independent mortgage broker and Emma selected an 80 per cent LTV mortgage deal with Virgin Money which gave her £300 cash back.
She said: “Mum and Dad’s support meant I could secure a better rate on my mortgage. And once you start looking at different mortgages it all starts to make sense.
“But my biggest worry was whether the products I had seen on the market were going to be available to first time buyers. Seeing a broker really helped to illustrate the options open to me and it was reassuring, because it gave me peace of mind that we had actually been looking at the best deals available.”
Emma chose a two-year deal over a 35 year term with flexible features built in. This means that if she can afford to, she can pay more than her monthly payments, or ‘overpay’ her mortgage by up to 10 per cent of the outstanding balance each year. She can also choose to take payment holidays after a certain number of consecutive payments, subject to further affordability checks.
She said: “I didn’t want to tie myself in for too long, as the market is likely to be very different in a couple of years and I don’t know how much my own circumstances might have changed.
“I don’t plan to use the flexible features either, but having them there helps give me peace of mind. And the cash back has been useful in terms of reducing my initial outlay.”
Initially, Emma viewed her flat alone, and said she didn’t get the ‘wow factor’ straight away. She explained: “I didn’t instantly know that it was the right property. It needs a bit of work, but the vendor was keen to sell.”
Emma managed to secure a purchase price of £162,500 after making an initial speculative offer of £150,000. She said: “The flat had been on the market for £185,000 and my initial offer was intentionally low. I didn’t expect it to be accepted.”
Barrie and Michele accompanied Emma to her second viewing and Emma also viewed some other flats in the same building on which work had been carried out. This allowed her to see the potential in the property. She went on: “It was definitely in the right location and seeing the other flats meant I could more easily see the value I may be able to add to it over time.”
Now, Emma is focusing on putting her own stamp on her new home. Over the next few years, she plans to add new double glazing, replace the flooring, update the kitchen and bathroom and make the living room and kitchen into one open-plan space.
She said: “I feel as though I have fumbled my way through the process but I am a very proud home owner and can’t wait to get properly moved in.”