Here’s Mortgage Tree's quick guide to buying your own home
1. Ensure that you able to obtain a mortgage
The process of buying a house starts with a check to see that you qualify for a mortgage. When you contact Mortgage Tree we will carry out the relevant checks to determine if you will be able to secure a mortgage and subsequently assess which mortgage will be best for you dependent on your circumstances. We will explain the setting up and monthly costs and obtain an ‘agreement to lend in principle’ from a lender.
2. Choose your home & making an offer
Agree a purchase price with the estate agents or vendor. If you are close to a stamp duty band threshold try and negotiate a price at or below the band limit, (see our Costs of Buying A House section). Do NOT put offers in writing without the help of a Solicitor – you may find yourself legally committed to buying the property even if your finances go wrong!
3. Choose a Solicitor
You will need a good conveyancing Solicitor. If you do not have one, Mortgage Tree will recommend one to you. They will be ones you can trust who have good experience in the field. Expect to pay around £150-£300 for search fees to get the legal process started with the balance payable at completion of the property purchase.
4. Submit your mortgage application
When you have chosen your house, your offer has been accepted and you have decided on a mortgage product, Mortgage Tree will submit your application to the lender. On submission you may be required to pay a valuation/survey fee. At this stage you will also need to consider life assurance, income protection and the buildings and contents insurances for your new home.
5. Time Scales
The mortgage application process takes a little time, usually around 2 to 3 weeks to obtain a mortgage offer from the lender. During this time your broker is earning his money; talking to lenders, supplying the lender with information, keeping you up to date, obtaining valuation and survey results and pushing the lender for the mortgage offer to be issued.
6. Mortgage Offer... then over to the solicitor
Once your Mortgage Offer has been issued it is at this time when you will be expected to pay any broker fees previously agreed. Your solicitors will at this time be completing there searches and checking title deeds ect. You will need to discuss the purchase contract, including any restrictions on the property will them and then sign any documents that they require you to sign. The Solicitor then holds this, pending step 7 below.
7. Exchange Contracts
Time to commit! Your Solicitor gives your signed contract to purchase to the sellers’ Solicitor and in return receives the sellers’ signed contract to sell. This is therefore the ‘exchange of contracts’ and includes the setting of a completion date. You will also need to pay at least 10% of your deposit at this point. This is non-refundable if you pull out, and you can be sued for breach of contract. Your life cover needs to commence along with the buildings insurance at least as you are legally responsible for the property from this point.
The Solicitors complete the final legal aspects. The balance of your deposit and the mortgage monies are handed over to the sellers through their Solicitors, and you receive the keys. The house is yours and the seller has to vacate. You will pay the balance of your legal fees and stamp duty. Your Solicitor records your new ownership at the Land Registry. You may receive the Title Deeds to your home for safekeeping.
These are the steps you need to consider when looking to buy a property in England or Wales the process is slightly different in Scotland.