Buying a home is a huge financial commitment; there is plenty to think about so it can be challenging to know where to start. We have produced a guide to help you buy your perfect property in six simple steps:
Before you start house-hunting, it is a good idea to work out the amount you can afford to spend on buying a property and on your monthly mortgage payments. There are many mortgage affordability calculators online which can give you an estimate of how much you can borrow based on your income and outgoings.
Consider how you will cope if your financial situation changes, or interest rates rises, and be careful not to overstretch yourself. Your savings will have to cover not just the deposit but expenses such as mortgage fees (anything up to £2000) and Stamp Duty on properties costing more than £125,000. Before you fall for your dream home, make sure you understand the cost of buying property.
It’s never too early for you to start thinking about arranging a mortgage as this can be time-consuming. You can get a mortgage from an Independent Adviser (IFA), mortgage broker or lender. VA has a panel of IFA’s who we can recommend for great advice and a whole of market deals. Ask a member of the VA Team.
Once you’ve found a mortgage, agree a mortgage “in principle” (MIP). This tells you how much money the lender is likely to offer and the interest rate you will pay.
You may have to pay a booking fee to reserve the mortgage product you want. Typical cost: £99-£300.
Before you apply for a mortgage check your credit report for any errors and to get an idea of your score as lenders will look at it when making their decision on your application.
market every week so be sure to register your details so that you are the first to view new instructions. Once you have found a home you want to buy, the next step is to make an offer through VA Property Consultant. We will pass your offer to the seller and begin to negotiate on your behalf until the offer is accepted.
A solicitor will handle the legal work around the property (conveyancing) and the surveyor will survey the property to check the problems, which might impact on the cost of the home. Your solicitor will tell you how much you can expect to pay and may ask for a deposit upfront – this typically 10% of their fee. Typical cost: £250 - £300
VA has a panel of solicitors who we can recommend for great service and advice. Ask a member of the VA Team.
This is carried out by the lender to make sure the property is worth the price you are paying before they approve the mortgage. It is not an extensive survey and will not identify all the repairs or maintenance that might be needed. Typical cost: £150-£1500 depending on the valuation of the property. Some lenders may not charge you for this, depending on the type of mortgage product you select.
You should commission a survey on the property to help you avoid hidden costly problems further down the line. For example, if the survey reveals a problem with the home that will need £5000 to pay for repairs, you could ask the seller to lower the price by that much.
Home condition survey: this is the most basic and cheapest survey. Typical cost: £250+ Homebuyer’s report: this is a more detailed survey, looking thoroughly inside and outside a property. It also includes a valuation. Typical cost: £400+
Building or structural survey: this is the most comprehensive survey. Typical cost: £600+
Once the survey is complete you may want to go back and renegotiate the price of your home. There are two reasons for this:
It is this stage in the process that is often most stressful. Delays and problems can arise from a variety of situations such as:
If everything has gone according to plan, contact your lender or mortgage adviser to proceed. There is often a fee, usually called an arrangement fee to set up the mortgage.
If there are no problems or delays, then you should receive the contract to sign and complete the sale. Before signing the contract, go through it with your solicitor to check that all the details are correct. Make sure you are happy with what the sellers have agreed to leave in the property and that all your queries have been answered.
At this stage, you and the seller are committed to the sale. You are usually required to pay a holding deposit at this stage to show serious intent.
Once you have changed contracts you will need buildings insurance in place to cover the structure of the property.
There is typically a four week deadline between exchange of contracts and completion of the sale but both the buyer and seller can agree to a different time frame. Once the sale is completed you will have to pay a number of charges:
You pay stamp duty at these rates if, after buying the property, it is the only residential property you own. You usually pay 3% on top of these rates if you own another residential property.
| Property or lease premium or transfer value | SDLT rate |
|---|---|
| Upto £250,000 | Zero |
| The next £675,000 (the portion from £250,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
Congratulations the sale has gone through, you will now need to start thinking about moving home. VA’s Top Buyers Tips