Buying a house, particularly for the first time can be daunting. The decisions you make when buying a property could save you – or cost you - many thousands of pounds. Our step-by-step guide takes you briefly through each step you are likely to take during the home buying process, and you can find more details by following the links within each section.
Although 86% of people in the UK want to own their own home, it’s not always right for everybody all the time. There are a number of things you need to think about before setting off on your home hunting quest – not least whether you can actually afford it.
If you are already a homeowner, decide whether you want to sell your house or flat before you buy. It can be riskier in a rising market, but there are upsides. In particular, you will be able to pounce quickly when you do find the home of your dreams, and you won’t be trapped in a housing chain
How much do you want to spend? This might be dependent on how much of a deposit you can get together. Don’t forget the variety of one-off and ongoing costs of buying a home. These can put an extra 15% on the cost of your home – more if you are doing serious building or redecoration work.
Work out how much of a deposit for the mortgage you can get together. Think about savings, the “bank of Mum and Dad” and how much you would get if you put your current home on the market and paid off your deposit. If you have any savings on long term deposit that you plan to use, cash them in.
Unless you are a cash buyer, you’ll need to decide what sort of mortgage you want.
While you can’t get a mortgage before you buy, you can get a mortgage in principle, which will put you in a stronger position to buy.
A mortgage broker can be particularly helpful if you would like advice on mortgages, to scan the full range of mortgages in the market or if you have special circumstances such as being self-employed.
If you want to move to a new home close to where you already live, there is little to decide
If you want to move to a different part of town, or across the country, then deciding the area is more difficult and time consuming
This is a very important decision – get it wrong and you will either be unhappy with where you live, or face the costs of moving again.
Once you know the area you want to live, research the properties in that area thoroughly so you get to know the local market well
You need to visit as many properties as possible, and make sure they are no hidden surprises.
It’s also important to understand whether the property is freehold or leasehold, and that it is not on a short lease.
Make sure you are in the strongest possible position as a buyer. Get to the front of the buyers’ queue
Decide how much you want to pay, including for fixtures and fittings.
Make the offer to the estate agent and seal the deal.
You might be asked to pay a small holding deposit of £500 or £1000 to show you are serious. It will be repaid if the sale falls through
Hopefully your offer will be accepted by the seller
Consider whether or not to get Home Buyer’s Protection Insurance
You should ideally have got your finances in place as much as possible before making an offer. If so, you now just need to go back to your mortgage company with the agreed offer and complete the process
If you haven’t got your finances in place, you must now scramble to do so as quickly as possible, before the seller loses patience.
You will need to get the lender to make you a formal mortgage offer before you can exchange contracts
If buying with a mortgage, it is also a good time to consider whether life insurance is a good idea.
Once you have agreed an offer on your house, you need to get a solicitor or conveyancer to handle the legal work to transfer ownership of the property to you.
The solicitor or conveyancer will do the searches, such as with the local authority and Environment Agency, to ensure there are not any major problems with the property.
Your mortgage lender will require a valuation by a surveyor, to ensure that the property is a good enough to lend against. This is not a proper survey, and will only look superficially at the property
You commission your own survey to evaluate the condition of the property and alert you to any potential problems you will face once you move in. Unless you are very experienced with property, it is usually worth getting a survey done
Before you can exchange contracts, you need to arrange for the funds to be sent to your solicitor or conveyancer
When you exchange contracts with the seller you become legally committed to buying the property – and they are legally committed to selling it do you
You should only exchange contracts after you have received the surveyors report, and any necessary action has been taken
Before you exchange contracts, you need to agree a completion date with the seller, about four weeks after the exchange
You can only exchange contracts after the solicitor/conveyancer is satisfied with the searches, a formal mortgage offer has been received, and funds are received.
You need to ensure that you take out buildings insurance for the property from the date of exchange, as you are responsible for it from then on. Indeed, it is usually a condition of the mortgage that you have buildings insurance in place.
You need to negotiate any final things that have not yet been agreed, such as buying the seller’s appliances
You need to make arrangements for the supply of electricity, gas, water and telephone service, and that the seller has got readings made. Often, it is easiest simply to change the account name for the existing suppliers to the property, rather than change suppliers, which you can do at a later date.
The solicitor/conveyancer will inform the land registry that they are in the process of transferring ownership of your property.
Your solicitor/conveyancer should be liaising with the mortgage company to ensure the money will be ready for completion.
Completion is when you pay for the property and take ownership of it and takes place at a certain time of day – often midday.
On the day of completion, the money is transferred, and the deeds of the property are transferred, between each side’s conveyancer.
The seller must leave the property by the time of completion, and you should then be able to collect the keys, normally from the estate agent.
You are now free to move in, or if you are doing any building work before hand, the workmen can now start.
You will need to make normal administrative arrangements for getting permission for parking for removals vans etc.
After completion, your solicitor or conveyancer will send you an account, covering all their costs and disbursements, as well as the purchase price of the house and stamp duty.
Your solicitor or conveyancer will normally pay the stamp duty for you, and ensure that the change of ownership is registered with the land registry
There may be a small refund due to you if the solicitor has overestimated the costs.
If you are looking to buy your next home, please feel free to call the office on 0121 430 4448 or email firstname.lastname@example.org for more information on how we can help you find your next home.
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