We can read your mind. We know you're probably thinking, 'What is a first-time buyer? That's a dumb question!', but not so fast...all is not necessarily as it seems.
As with most things in life, defining a first-time buyer isn't always a black or white affair as there are a few shades of grey in between. First-time buyer status can vary from lender to lender, while the Government has its own rules you'll need to meet if you are to qualify for the benefits associated with being a first-time buyer, such as the removal of stamp duty on the first £300,000 of purchases up to £500,000.
So, before you head back to Facebook or dig out your favourite cat video, you may want to read on...
The obvious answer
Working out who is a first-time buyer and who isn't should be easy, but there are certain instances where an individual or couple may think of themselves as first-time buyers only to find out that their lender or the Government considers them otherwise.
The obvious answer would be garnered from asking whether or not you have bought a home in the past, but what about if you are buying as a couple and one of you has already bought a home but the other hasn't? Or if you've owned a shop, or maybe even a home abroad? What about those who have inherited property?
In an ideal world, the only point of consideration would be whether you have bought a home before or you haven't. If you have, you're not a first-time buyer. If you haven't, you are. Things, however, are a little more complicated than the dictionary definition above may lead you to believe at first glance.
Instances where you'll commonly be accepted as a first-time buyer
Let's get the above answer out of the way first: If you are a single person who has never owned a home before anywhere in the world, you will be regarded as a bona fide first-time buyer. Same applies to couples where both partners have never previously bought a home.
What about if you own, or have owned, commercial property? Good news! Providing you've never owned a home before, you'll qualify for first-time buyer status, too. Confusion abounds over this point as you are effectively a property owner. However, the first-time buyer rules apply only to property used as a home, so, if you own, or have owned, a shop or a restaurant, for example, but have never bought a home before, you will indeed be classified as a first-time buyer.
The only caveat here is whether or not the commercial property you own, or have previously owned in the past, has living quarters attached to it. If it does, you will not be entitled to first-time buyer status, unfortunately.
Who doesn't qualify as a first-time buyer?
As we've already ascertained, anyone who has owned a home before will not be eligible for first-time buyer status...regardless of whether you actually bought the home or not.
The 'buyer' part of the term first-time buyer can be a little misleading for those who have inherited property. They will indeed be buying for the first time, but the rules state that you must never have owned a home before, which doesn't mean the same thing as never having bought one before.
Couples looking to buy their first home together need to be careful, too. As mentioned above, providing both of you haven't owned a home before you'll be fine, but if one of you has, then you will not be eligible.
The same rules apply for anyone lucky enough to have their property bought for them by their parents or anyone else. If the buyers own their own home, they will not be able to apply for first-time buyer status through you.
Prospective buy-to-let landlords are out of luck as well. Even if you have never owned a home before, you will not be able to take advantage of the new Government rules on stamp duty if you intend to use the property in question as rented accommodation.
Want to find out more?
If you're looking to buy property in or around East London and West Essex and have any further questions about buying your first home, we're here to help. Our friendly sales team are always delighted to offer any advice you may need, so give them a call today on: