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Sometimes it pays to be clueless. Help is out there

Lucy Tobin finds a happy first-time buyer — but he did have a deposit and expert advice

AGED, 26, Raj Singh decided it was time to move out of his parents’ home in Letchworth, Hertfordshire.

 

He works as a locksmith and also wanted to live closer to his work headquarters, in Ealing. With a healthy £35,000 squirrelled away in a savings account, he was in the unusual first time buyer position of not having to worry about a deposit.

 

But he did face one problem: “I had no idea how to buy a place. I wanted a small, one-bedroom property with low maintenance costs in a good area. But I didn’t have a clue about what was a fair price or a good location, or how to get a mortgage. It was daunting.”

 

So Raj talked to his girlfriend’s father, who recommended using a property investment adviser, North Star Homes. In March, Raj approached the company, which sourced three properties for him to visit. A one-bedroom flat on the top floor of a former council block, set back from Ealing’s town centre and on the market for £128,000, was exactly what Raj wanted.

 

North Star totted up the total cost, including deposit, renovation work — Raj didn’t like the Artex walls and the flat needed refurbishment — plus solicitors’ fees and the company’s own charge: 3.75 per cent of the asking price, about £4,500.

 

“They told me I would need £31,000 all in, which was brilliant as it meant I’d have some savings left over at the end,” he said. He opted to use a mortgage broker as “I had no idea how to get funding otherwise”.

 

His adviser outlined a range of options, and pointed out that he would get a better rate if he could raise his deposit from 10 per cent to 15 per cent. “I had the spare money, so I did it,” said Raj. “The rate fell, and I opted for a three-year tracker mortgage with Nationwide. I’m paying back 4.1 per cent interest, so repayment costs are manageable.”

 

Then, just before completion, the block’s managing agent announced that urgent building work was required, and all flat owners would have to contribute £5,000, but Raj negotiated an exemption because the works weren’t announced at the start of his purchase.

 

Now he has moved into the flat. “It’s lovely,” he said. “It’s in quite a green area, my commute has disappeared and it was pretty stress-free. I’m really happy.”

 

Raj Singh is settling into his new flat with no commute.

 

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