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The Buying Process!

20 October 19 Author:Michelle Gaffaney
mortgages

You have found your perfect home, and decided to put an offer down, but what happens now? Here is our step by step guide to try help ease the stress.

Stages and timeline when buying a house?

The timescales for purchasing a property can vary from 6 weeks to 8 months roughly, depending on the seller and buyers circumstances. Also if conveyancing issues arise this can cause delays too.

Find a property –

Research the area you want to live, then use the online property portals, and local estate agents to source your ideal home. It is also worth seeing if anyone local knows of a property that may be coming to market. This way both parties can avoid costs involved when dealing with an estate agent.

Put in an offer –

Once you have found the property you want put your offer forwards with any terms you may have. From this point to exchange it can take roughly 4 to 12 weeks.

An accepted offer –

Appoint a conveyancing solicitor, they will then ask the relevant questions to the sellers solicitors, and a survey will be arranged to check the condition of the property.

Exchange –

Pay your deposit! At this point you can’t back out without having major costs. Exchange to sale from this point can either be instant or take up to 4 weeks.

Completion –

The rest of  the funds are transferred from your solicitors to the buyers solicitors and arrangements are made for your new deeds and keys. The property is now legally yours.

keys-alamy_1931210b

Do you have the funds for the property?

Before you start the hunt for you new home you need to make sure you have the funds available to do so. You can use a mortgage affordability calculator or have a meeting with a mortgage broker who will advise you of what the maximum is you could get on a mortgage. However, before taking the great leap into getting a mortgage think about the costs involved. Consider what will happen should your financial situation change, or the interest on your mortgage rise. Its also important to remember that your savings you have got together for your deposit also need to cover other expenses such as solicitor fees, and potentially stamp duty. It is always worth doing your research to avoid any costly mistakes.

Which mortgage is right for you?

Finding a mortgage can be stressful and time consuming with so many types of mortgages and deals available out there. One way to make this part a little easier would be to go to an independent mortgage broker, financial adviser, or lender, who can search all the deals available to you to find your best match.

Once you have found the best mortgage for you then it is time to get it agreed in principle ready for when you do find the right property and want to make an offer. A mortgage in principle tells you how much the lender is likely to offer you and what interest rate you will pay. Sometimes you might have to pay a reservation fee for the mortgage product this can be from £99 up to £250 roughly.

Don’t forget there are also help to buy schemes available so it is worth doing some research to see if you would be eligible, or your broker may be willing to look into it if you ask.

mortgages

Credit reports

It is always best to check your credit score before looking to buy a house as lenders will consider this when you put an application forward. If you don’t have a good credit score this could mean you won’t get accepted for any mortgages, or you may end up with a high interest rate mortgage.

Ready to make an offer

You have your deposit ready in the bank, your mortgage in principle is in place, and you have found your perfect property, now it is time to make an offer. Remember it is always worth seeing if you can get a lower then sale price offer accepted. Whether it does get accepted at lower then the sale price will depend on a number of factors, such as how long the property has been on the market.

Accrepted-Offer

Find a Solicitor

Ask people you know or the estate agent your dealing with for recommendations of solicitors to use. The typical cost for a solicitor ranges from £500 to £1,500 + VAT. The solicitor will handle all the legal work for you. At this point a surveyor will also be appointed to survey the property to check for problems which may affect the cost of the home. The solicitor will proceed to submit searches to the local council to check for planning or local issues that may affect the value of the property.  The typical cost for these searches is £250-£300.

The valuation survey is requested by the lender to make sure the property is worth the price you are paying before approving the mortgage you have applied for. Please note this is not an extensive survey so it will not identify any repairs needed on the property. The typical cost for the survey is £150 to £1,500 depending on the value of the property. Some lenders don’t charge you for this but it depends on what mortgage product you went for.

A property survey

You should pay to get a decent survey done to save on hidden costly problems down the line. If a problem is flagged up in the survey you could use this to to negotiate a drop in price. Here are some types of surveys available:

  • Building or structural survey – this is the most comprehensive survey to have and it is suitable for all residential properties. The typical cost for this survey is from £600 upwards.
  • RICS condition report – this is the cheapest and most basic of surveys, it is suitable for new builds, and homes in good condition. This survey does not provide any valuation or advice and costs around £250.
  • RICS homebuyer report – this survey is suitable for properties in reasonable condition. The survey is more detailed and the interior and exterior of the property are thoroughly examined. A valuation is also provided with this survey. Typical cost for this survey is £400 upwards.

RICS-Homebuyer

Final stages in the process

Once the survey has been done assess whether you need to look at renegotiating the price of your new home. Are there problems with the property too expensive to fix? Has the lender valued the property at less then the negotiated price? If so, then you need to put a new offer forwards in line with what the survey has revealed. If all is fine then you need to proceed with finalising your mortgage.

Finalising your Mortgage

If your happy with everything so far then you need to contact your mortgage adviser or lender to proceed. Generally when setting up a mortgage you have to pay an arrangement fee this can vary in price from £0-£2000. Once you have received your mortgage offer you get 7 days to think whether that mortgage is right for you, this gives you chance to compare it with others. If it is right for you then let your lender know you want to proceed you can now look to exchange contracts.

Exhanging Contracts

As long as there are no further issues you should receive the contract to sign to complete the sale. It is best to go through this contract with your solicitor to check it is correct. Make sure you are happy with what has been agreed and that any queries you had have been answered. You and the seller are now committed to the sale, sometimes sellers do ask buyers to put a holding deposit down just to show they are serious about buying. Remember now the property is your it is wise to get buildings insurance on the structure as soon as possible.

Completion

At this point your solicitor will transfer the funds for the property to the sellers solicitor. You will have to pay a fee of £25-£50 for the telegraphic transfer. You may also have to pay a mortgage account fee of £100-£300. Finally, you will have to pay your solicitors bill too, typical cost £500-£1,500 + VAT.  Your solicitor will then register the sale with the land registry, the cost of this depends on the price of the property. If your house was over £125,000 you will need to pay the stamp duty within 30 days of completion on the property.

Finally, Look for a recommended removal company to move you in! Typical cost £300-£600.

removal-company-abroad

We hope this guide has been useful for you, if you would like any more advice or tips pop to our blog.

http://www.greenstone-design.co.uk/blog

 

 

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Michelle Gaffaney
Michelle Gaffaney - Architectural Director
With a wealth of experience working on a range of projects, Michelle Gaffaney has a passion for design and strong relationships with her clients. Connect with Michelle on LinkedIn