Guide to buying a property with Mortgage321.
This guide will talk you through each of the key areas of purchasing a property from getting started, finding a property and making an offer, to completion of your purchase and collecting the keys to help you understand the structure and buying process.
Our staff are always on hand to offer help and provide guidance on finding the perfect property and your mortgage transaction.
At Mortgage321 we want to ensure that buying your new property is an enjoyable experience and we find that if you know what to expect you will receive a better service form us.
This guide has been created to explain all key areas of the property buying process, so that you’re as informed as possible and feel confident about the next steps that lie ahead.
Preparing to buy
When deciding to buy a property, there are two key areas you need to consider before starting to view properties:
Budget, costs and mortgage
Choosing the right property
Budgeting & mortgage services.
Before you search for a property, we recommend you take time to carefully consider your budget.
You should consider how much you could spend each month on your new mortgage, and also how much of a deposit you can raise towards your purchase.
Understanding your credit history.
Before applying for a mortgage it is a good idea to check your credit history to give you a better understanding of the options that may be available to you.
By clicking on the advert to the left you will be able to register and receive a copy of your multi-agency credit file free for 30 days*. By sending your credit report to our mortgage advisors they will be able to talk you through the results and what they mean to your mortgage application and choice of lender and mortgage product.
By understanding your credit position, our advisors will be able to find you the right mortgage product available to best suit your needs.
Additional purchase fees.
Most buyers spend a lot of time focusing on their deposit and mortgage during the budgeting phase, but often they forget about the additional fees and the cost of moving.
• Conveyancing/legal costs
• Additional disbursements
• Stamp Duty
• Property valuation/survey fee
• Packing Materials
• Royal Mail Redirection Service
We would be happy to provide you with a break down of costs for the Conveyancing and Disbursements of your transaction through one of our associate law firms and the costs of a any mortgage valuation/survey that is required.
Choosing the right property.
When moving house, it is important for you to consider the type of amenities you will require from the local area, especially if you are relocating.
Things to consider:
Below are a few suggestions of key points you may wish to consider when thinking about where to buy:
Council Tax Bands & Charges – to help you with your budgeting;
School Catchment Areas - this may impact your ability to secure a place at the local school;
Local Parks and Recreation Areas – if you have children or dogs, is it important to have facilities such as this nearby?;
Job Prospects – if you are relocating, it is important to research the employment potential in the local area, or understand commuter costs/routes if you need to travel to work;
Local Transport Services – if you don’t drive, or have limited access to your own vehicle, you may want to consider your reliance on public transport links;
Amenities and Clubs for Young People – if you are moving with young children, you may wish to enquire as to whether there are any clubs or amenities for children and young people within the local area, to peak their interest;
Local Development Plans - moving is a long term commitment, so you may want to research any plans with the local authority to change, expand or build the local road networks, or if there are any major building developments planned that may affect your access, lifestyle and even view.
Age of Property:
You should always consider the age of any property you may wish to buy. There are benefits and draw backs to buying both new build and older properties dependant on your own personal preferences and point of view.
Older properties tend to have more character. You may find properties full of original features within your budget, but they may be in need of modernisation. Sometimes older properties come with hidden costs, with the need to upgrade wiring, heating, repointing and damp proofing. Older properties can provide you with a blank canvas to let your imagination run wild, if you are looking to put your mark on a property. Older properties do tend to have larger rooms and gardens, ideal for growing families and those who like their space.
New properties are often fitted with luxury kitchens and bathrooms with integrated appliances. They tend to be more energy efficient than older properties, due to better windows and more efficient heating systems. They tend to lack character, but again can provide you with a blank canvas to make it feel more like home. They normally require less maintenance and upkeep, however the rooms can be a little on the small side, but often they do come with space saving features, such as built in storage.
You also have the added benefit of being able to use the Governments Help to Buy Equity Share Scheme to increase your deposit by up to 20%, find out more
It is important you think about the type of property you want to buy before you start to view. There are pro’s and con’s to all property types and it is important you do your research before considering making an offer.
Flats, Apartments & Maisonettes
Most flats, apartments and maisonettes are leasehold or share of freehold properties. Leases can be costly to renew and can impact the type of mortgage you can obtain. As the fabric of the building and many facilities are shared with other residents, most properties will be subject to ground rent and or annual maintenance/service charges. This will of course need to be considered when working out your budget. Many items of general maintenance may be covered by the ground rent and maintenance charges, which may save you future expense for costly repair items such as the roof, or fabric of the property. Due to the number of new large developments, availability of flats and apartments can provide more of a choice in and around your chosen location.
The majority of houses are freehold and so there are no additional or yearly charges to take into account. If you are looking for outside space, you are more likely to achieve this by buying a house, as opposed to a flat, apartment or maisonette. With houses, you are solely responsible for its upkeep and the upkeep of any outside space. Large repairs can prove costly, and need to be taken into consideration. Houses in some areas may not have allocated parking.
Top Tips for Viewing
Viewing a property is exciting and key to finding the right home for you, however there are still some essential things you need to look for to make sure it is right for you. Here are our top tips:
Look over the outside of a property as well as the interior;
Try to view with everyone in your moving party, to avoid the need for multiple viewings to ensure you don’t miss out on your dream property;
Check for damp. Look out for mould, musty smells or dark patches on walls and ceilings;
Don’t forget about the structure of the property. Keep an eye out for cracks, even hairline cracks, on the walls, around windows and doors and on the ceilings;
Allow plenty of time to look around the local neighbourhood and the amenities available in the area;
View the area at different times of the day to see any changes in different lights or surrounding area noise and traffic levels.
Making an offer.
Ready to Make an Offer?
Now that you’ve viewed the property, is it the one for you?
Have you done your homework and looked at the surrounding area and local amenities?
If the answer to the above questions is yes, then you are ready to make an offer.
Things to Consider Before Making an Offer:
Look for comparable properties that have sold in that area for guidance on what a suitable offer would be
Look at demand for similar properties in the local area. If demand is high don’t wait too long before making an offer, you don’t want to miss out
Consider how long the property has been on the market and find out the Vendor’s motivation for selling the property, there may be an opportunity to negotiate on the asking price
Consider any essential works that may be required on the property, you may wish to factor this into the offer you make.
Making the Right Offer
Be honest about your position; make the agent aware if you are a first time buyer, chain free or waiting to sell your own property
Be realistic and upfront about any restrictions or dependencies you have regarding completion dates
Make sure your offer is subject to contract and subject to a satisfactory survey. We will talk about surveys later in this guide
Be ready to provide proof of ID and address, evidence of deposit, and evidence of funds and origin of funds if you are a cash buyer. Without this both us and the selling agent cannot substantiate your offer or put your offer forward to the vendor in the best way.
Once your offer is accepted.
Instructing a Conveyancer
Once your offer is accepted, it is time to instruct a conveyancer to act on your behalf in relation to your purchase. Instructing the right professionals to assist you in moving home is essential.
What does a conveyancer do?
They will obtain a purchase contract from the sellers’ solicitors with details of the property and its ownership.
They will sort out any pre-contract enquiries and obtain copies of any existing guarantees, planning consents, etc.
They will obtain the seller’s fixtures and fittings list to see what they will be leaving in the property and you will get a copy to check.
When your mortgage offer has arrived, they will arrange for you to sign the contract and hand over your deposit to hold in readiness for ‘exchange’.
When the mortgage conditions have been met and the sellers are ready to proceed, a completion date is agreed that suits everyone in the chain. Contracts can now be exchanged and the transfer deed effected.
Once this has been done they can call down the mortgage advance from your lender and send you a final completion statement.
On completion day, your conveyancer will pay the required amount to the seller’s solicitors in exchange for the title deeds. You now own the property!
Your conveyancer will now register your name and mortgage at the Land Registry and send the deeds to your lender for them to hold as security for their mortgage advance.
Instructing a survey.
Types of Survey Available
Before you buy your new home you should arrange for a surveyor to carry out a survey of the property. A survey will tell you whether or not the property is a good investment without structural faults, to ensure you really know what your are buying.
There are several types of survey:
Valuation Report – Required by all mortgage lenders to confirm that the property value is sufficient security to cover the loan
Building Survey - A more thorough survey of the property’s construction and condition. It provides detailed information on how the property has been constructed, the materials used, the condition of the fabric of the property. Recommended for properties that are very old, run down or expensive.
Home Condition Report – Focusing on the condition of the property such as the roof, walls, windows, floors and stairs. The condition of each element is reported through clear ‘traffic light’ ratings, helping you to easily identify any problems
Home Buyer’s Report – Provides more thorough information about the basic fabric of a property. It will comment on defects or problems that may affect the value of the home.
The buying process.
The Legal Process
Your Conveyancer will take charge of the legal process on your behalf. Below we have outlined the key milestones for the transfer of ownership from the seller to you:
You apply for your Mortgage
Seller’s Solicitor responds to and answers Additional Enquiries
Both sides Solicitors prepare for signing the Contract
You lodge your Deposit with your Solicitor
Contracts are exchanged and become Legally Binding
Seller’s Solicitor obtains the Title Deeds
Seller’s Solicitor prepares the Draft Contract and sends to your Solicitor
Your Solicitor applies for Local Searches
You instruct your Survey
Your Solicitor raises Preliminary Enquiries with the Seller’s Solicitor
Seller’s Solicitor prepares answers to the Preliminary Enquiries and returns to your Solicitor
Based on the Seller’s response your Solicitor raises any Additional Enquiries and sends to the Seller’s Solicitor
You have now officially Exchanged on your property. Now that you have reached exchange the sale is formally agreed, and all parties begin to prepare for Completion
Preparing for completion.
Now that you have exchanged contracts, both parties are legally bound to complete the transaction. Your Solicitor will normally confirm the completion date on exchange of contract, if it has not previously been agreed between you and the seller. Upon completion your Solicitor will transfer the remainder of your funds to seller’s Solicitor and ask them to confirm receipt. Once this is done, you can collect the keys to your new property!
To ensure completion goes smoothly, make sure you are well prepared for your move. We sometimes get so wrapped up in the legal process, we forget to make arrangements for moving day.