The process of buying your own home can sometimes feel daunting. When you decide that you would like to take that first step on to the property ladder it is new and exciting but the process can seem confusing.
Whether it is your first time on the property ladder or you have moved several times, new legislation appears all of the time in the process of selling and buying your home.
The role of an Estate Agent is not only to sell your current property but to help you buy your next home and guide you through the process.
Below is a basic guide on how to buy a home.
Find out how much you can borrow
Call a mortgage broker. Generally a mortgage broker has access to many lenders and acts in the interest of you and your requirements. Your bank might be right for you, however they will be unlikely to recommend other lenders’ products which may offer a better deal.
A mortgage broker is able to search the market to fit the mortgage to your needs. They will be able to determine the best available mortgage offer and provide an idea of maximum amount you can borrow. Laurence Tremayne has an in-house independent mortgage broker called Affinity Mortgage Solutions. Read more about how they operate and for clear explanations on mortgages.
A word of warning: Regardless of the maximum that you are able to borrow, don’t stretch to more than you can comfortably meet in monthly repayments. Remember to keep some savings aside to meet stamp duty and other fees and to furnish your new home.
Define your criteria
Once you have a clear idea of what you can borrow you will need to start thinking about your search criteria. Sit down and make a list of what you want from your next home.
Some of the most common questions you will ask yourself are:
• What area do I want to be in? Do I want to live in a village? Town? Within a certain school catchment area?
• Do I want to buy an apartment? Or do I want to buy a semi-detached house or a detached house?
• How many bedrooms do I need? How many bedrooms do I want?
• Do I need parking? Would I prefer a driveway? Do I need a garage?
• Do I want a sizeable garden?
• Am I willing to perform some D.I.Y on the property?
• How far away am I from my workplace?
It is a good idea to prioritise which of these aspects are the most important to you. You may need to compromise on certain elements. For example, if you found a house that met all of your requirements except having a driveway, you may need to assess if you are willing to compromise on that point.
Beginning the search
Find out who the local Estate Agents are in the area. Ask for recommendations from your friends and family, then start looking at their websites. Pick up a local paper; some agents (like us) advertise our “Coming Soon” properties as well as their available stock.
Register with several agents. If they are proactive they will keep your details and notify you of anything new that is coming on the market that meets your requirements, before it gets to the market place.
Once you find a property you want to view, call the Estate Agent and arrange a convenient viewing appointment. Be prepared to view many properties; it is very rare that you will find your perfect home straight away, so please don’t despair. Remember your criteria, it is a big purchase and it must be right for your needs.
Make a checklist of questions to ask the Estate Agent. Below are some examples of what you could ask:
• How long has the property been on the market?
• How long have the current owners lived there?
• Has there been much interest?
• Are the sellers in a chain?
• What’s included in the price?
• What’s the council tax band?
• If leasehold, what are the service charges?
• How old is the property?
• Is the property freehold or leasehold?
Making an offer
Once you have found a property that you wish to make your next home, it is time to make an offer.
Many buyers make an offer below the asking price, and sometimes this is accepted. You may want to start low and negotiate with the agent to find a price that satisfies both parties. But if you want to be sure you get the property you like and you think it is worth the asking price; you may want to offer the full amount straight away.
Should you decide to put in a low offer and someone else wants the property, the vendor is in a strong position of being able to refuse the lowest offer and that bidder would then have to top the rival offer. This could lead to a bidding war, where both sets of buyers continually outbid each other until one side drops out.
If your offer is accepted, you will soon receive written confirmation from the estate agent under the heading ‘subject to survey and contract.’ This heading is a reminder that you are not yet legally committed to buying the home and can still pull out should you wish. Likewise, the seller can still take their home off the market, or accept a better offer. Matters only become legally binding from the point of exchange of contracts.
Once your offer has been accepted, you will need to call your broker to start with on your mortgage application and find a solicitor.
You, the seller and the mortgage lender – will require a solicitor or a licensed conveyancer to tie the contract together. Ask your estate agent, friends and family for recommendations.
It is likely that the estate agent will know several in your area and the estate agent would most likely recommend several that they have dealt with and are good at what they do. Remember, it is in the Estate Agents best interest to turn the sale around quickly to the satisfaction of both parties; they would rarely recommend a solicitor who would hinder the process.
What Does a Solicitor Do?
Primarily, your solicitor will act as the intermediary through whom all contracts and transactions will pass, such as the transfer of legal ownership of the property, money transfers and dealing with the seller’s solicitor.
Solicitors also carry out various property-related searches, such as:
• Finding out if there are any subsidence issues
• Researching any planned major developments affecting the property
• Checking the provision of drainage
• Ensuring requisite building consents are in place
• Checking the contracts and confirming legal title
• Checking against any breeches of covenants
• Satisfy the conditions of the mortgage lender
• Help you to fully understand the process you are engaged in
Additionally, if the property is leasehold, the solicitor will also engage with the leaseholder, which is likely to add some time and money to the whole process.
What is a Licensed Conveyancer?
The legal process of transferring ownership of a property from one person to another is known as conveyancing. A licensed conveyancer is someone who has trained and qualified as a specialist in all aspects of the law dealing with property. Their expertise and experience, and your peace of mind, is what you pay for.
Before a bank or building society will part with any money, it will need to value your property. This is so the mortgage company can be sure that your home is worth what it is lending in the unlikely event that it will need to repossess.
Your lender should arrange a surveyor to value the property within a few days of agreeing the mortgage in principle. Its valuation will be very simple and you should arrange your own survey to get an idea of what problems there may be with the property.
Read the survey when it arrives. If there are a lot of problems with the property and you are not happy to carry on with the purchase, then act quickly to let everyone know before you incur any other costs. If you do want to pursue the purchase, but the survey advises that you get quotes for work that needs doing, arrange for that to be done. If a lot of work needs doing, you may want to go back to the seller and renegotiate on the price you are paying for the property.
Exchange of contracts
After your solicitor or conveyancer has completed all the necessary checks you’ll be asked to sign a contract legally committing you to the purchase. At this point you will need to pay a deposit for the property. Once the contracts have been exchanged, deposit has been paid, the sale is legally binding and you’re past the point of no return.
You can now set a mutually agreeable date to complete the sale.
Not long now…
There are a just a few final preparations to ensure everything does smoothly before your completion date.
• Building insurance should be in place
• Sort out removal firms or van hire
• Ensure your utilities (water, gas and electricity) are connected.
• Inform your telephone/broadband provider
• Arrange for your mail to be redirected and let everyone know your new address.
Welcome to your new home
The day of completion. Once monies have been transferred is when the property finally becomes yours. When your solicitor tells you that the sale is completed you can pick the keys up from the estate agent. Welcome to your new home!