Should I Buy a House or a Flat?
The age-old debate between buying a flat (apartment) and a house continues to be somewhat of a dilemma for homeowners. Each option comes with...
Understanding the intricacies of the home-buying process is essential for anyone embarking on the journey to purchase their dream home. In this article, we explore the process of buying a house. 1. Start Saving & Review Finances Begin by saving for a deposit, a crucial first step in your homebuying journey. Do you have your […]
13 October 2023
Table of Contents
Understanding the intricacies of the home-buying process is essential for anyone embarking on the journey to purchase their dream home. In this article, we explore the process of buying a house.
Table of Contents
Begin by saving for a deposit, a crucial first step in your homebuying journey. Do you have your deposit saved or know where the money is coming from? Have you paid off existing debts, where possible, and have you reviewed your monthly outgoings and know what you can afford each month?
Top Tip: If you have a larger deposit, you will likely be able to access better mortgage rates.
Review your finances and understand how much you can comfortably afford to pay out on a mortgage each month. Consider not only the purchase price but also ongoing costs like utilities, council tax and even food bills.
Top Tip: Now is the time to review your spending habits and closing credit accounts, where possible. Look to pay off the biggest financial commitment first.
Be aware of the typical timescales involved in the process of buying a house. These include what can be a long conveyancing process and involve lots of negotiations. Understanding the timescales will help you plan effectively will result in a smoother and much less stressful process.
Top Tip: Consider your own timescales for moving. Remember that the average time for a house purchase to go through is 3-5 months, and this can take longer, so be sure to factor this in when planning ahead. If you put an offer in on the Friday, you won’t be moving in two weeks later.
You will need to get a decision in principle (DIP) from a mortgage lender. This is not a mortgage offer and is just a guide of affordability and once you have found a property, a full mortgage application will need to take place with credit searches once you find a property.
Top tip: Consider using a mortgage broker to review the market and your personal affordability. They will be able to search the whole market, rather than you being tied to one lender, so you will know what interest rates might be available to you. Some brokers charge a fee and others are free.
Once you know your budget, you are ready to start viewing and now you need to know what you are looking, how to choose a location and and how to secure your home. Start exploring online listings, visit estate agents, and use local resources such as Local Authority developent plans to find properties and locations that match your criteria.
Tip Tip: Visit the area and surrounding areas at multiple times of day and speak to people who know the area for recommendation of streets.
Attend as many property viewings as possible to assess potential homes. Take a notepad to take notes and ask questions to gather essential information. It is important to know as much as possible before you attend the viewing so you can act fast if you wish to make an offer.
Top Tip: Try using a Chrome browser is to install the add-on property log. This allows you to look at price adjustments on Rightmove so you can see what the property has been listed for and if there have been any price reductions.
Appoint a conveyancer or solicitor to handle the legal aspects of your purchase. Make sure you get a few quotes and ask questions such as how big their caseload is and what methods of communication they use. This will give you confidence in their processes so you know your case will be managed well. The conveyancers will conduct searches and ensure the transaction proceeds smoothly.
Top Tip: You are within your right to ask for a quote and breakdown of what is provided for the fee. Ensure all costs are included, and there won’t be hidden costs at the end. Also, the cheapest quote is not always the best. Make sure you check out reviews and recommendations.
Once you’ve found the perfect property and know what offer you want to make, you should make an offer through the seller’s estate agent. This should be done both verbally and followed up in writing. If you are offering lower than the asking price it is wise to evidence your offer with your own research as this is more likely to get you your offer accepted than without it. When making an offer make sure you are confident in your proposal. One thing you cannot change is what someone else offers, so if your offer is even £1000 too low and the seller chooses someone else, remember it is out of your control.
Top Tip: When making an offer always ask the estate agent about the buying process before viewing. For example, a best and final process means that you would put your offer in, along with other buyers and then will be asked to submit a final, usually higher bid, before the seller decides which bid to accept. Some sales will follow a ‘best and final’ offer process and others won’t.
If the seller accepts your offer and you have submitted the details of your solicitor, the property is likely to be taken off the market, although this is now always the case, so it is worth checking with the estate agent that the property will now be taken off the market and no more viewings can tke place, so you cannot be gazumped by another buyer. Gazumping is when another buyer makes a higher offer and the seller takes their offer over yours, after accepting it.
Top Tip: Build a good relationship with the estate agents, make your position, such as being a first-time buyer, and commitment to the property known and use this to encourage the sellers to take the property off the market as soon as possible.
Once your offer is accepted, the purchasing process can begin. You will now need to submit your mortgage application to your chosen lender, providing all necessary documentation. If you are using a mortgage broker, they will manage this process for you.
Top Tip: As part of the mortgage application process you will need documentation so it is worth having this ready. If you are employed, you will need 3 months’ payslips and 3 months’ bank statements (some lenders ask for 6). If self-employed, you will need an SA302 and at least 1 years accounts (many lenders require 2 or 3 years) and proof of sustainable income. You will also need a valid passport or driver’s license for ID.
Once your offer is accepted, its time to instruct your conveyancer and this is when the conveyancing process begins. The conveyancing process is the legal process that is undertaken when buying a home, involving the transfer of the title of that property.
Top Tip: Before you go ahead with a conveyancer, double-check their caseload commitments because if they are over-stretched, this can influence how long it will take you to complete your sale. If you aren’t happy with the service you are receiving, you have the option to change conveyancer.
Your mortgage lender will arrange a valuation of the property to ensure its value matches the loan amount. This is not the same as a survey and only confirms to the lender that the property is worth what you are paying.
Top Tip: Always get a valuation pack together of evidence of sold prices of similar properties in the local area. This means that in the event of a down valuation, should you choose to appeal, you have supporting information readily available.
Although optional, it is wise to instruct a surveyor to conduct a detailed home survey of the property, as this will identify any potential issues. For new build properties, you will need a snagging survey, rather than a home survey.
Top Tip: There are three levels of RICS survey, level 1 being the most basic and level 3 being the most detailed (advised for older properties or those in poor condition). The most common type for an average property is level 2.
Your conveyancer will perform various property searches, including local authority, environmental, and drainage searches. These can take place whilst you apply for your mortgage. Some conveyancers will charge upfront for these searches.
Top Tip: Ensure you have direct contact with your conveyancer so if you need to deal with an issue or raise a query, it can be done in an efficient way.
Once satisfied with your application, as part of the mortgage application process, the lender will issue a formal mortgage offer. If there are any changes, for example, in price, after the offer is issued, depending on the changes made, a new application may have to be submitted.
Top Tip: A mortgage offer typically lasts for up to 6 months; however, if a purchase is delayed, lenders will sometimes agree to an extension so always keep your lender in the loop with any changes.
It is common to wonder how long a house purchase should take. The answer is how long is a piece of string, but you can take steps to avoid any unnecessary delays. We would advise to touch base with your solicitor and the estate agent regularly (they should be updating you on progress at regular intervals).
Top Tip: Ensure you have a direct contact for your conveyancer so if you need to call with an issue or raise a query, it can be resolved in an efficient way.
If the survey identifies issues, the surveyor will outline this in their report. Read this report thoroughly, speak to the surveyor and any trades if necessary to get a better understanding of the remedial work required and then look to negotiate with the seller to address them before proceeding or negotiate on price if you are prepared to tackle the issues yourself.
Top Tip: For all surveys, if the surveyor cannot reach a conclusion, a recommendation may be made for a further survey with a specialist in the field. This might include an asbestos survey or a full damp report. It is wise to factor in additional costs for this into your overall budget.
Once all queries are dealt with, contracts will be exchanged, and your conveyancer will coordinate with all parties involved to set a completion date that suits everyone. Once you have exchanged contracts, neither the seller or yourself can legally pull out of the sale, and it is likely that you will complete the purchase soon after.
Top Tip: Although a completion date cannot be set before the exchange of contracts, it is good practice to get an idea of the preferred date of the seller as early as possible. For example, if they are waiting for a new build to be built and their timelines change halfway through the process, you need to know this as early as possible to be able to negotiate timescales.
Arrange building insurance to protect your new property from day one. Building insurance is usually requested by the lender, whereas contents insurance is not. However, it is wise to take out both policies to make sure your belongings are protected.
Top Tip: Once you have the property address, you can use an online comparison site to get quotes on insurance so costs for this can be gathered in advance.
Before completion, you will need to transfer the deposit and any Stamp Duty payments to your solicitor in preparation for completion. They will then send the deposit to the lender and complete the sale on the agreed date.
Top Tip: Make sure your conveyancer gives you plenty of notice to transfer funds to make sure they are transferred in advance of them having to transfer to the lender.
Finally, on the agreed completion date and once funds are transferred, you will be able to collect the keys to your new home. Congratulations – you now own a new home!
Top Tip: Your solicitor/conveyancer will then register the transfer of ownership with the Land Registry within 30 days of completion.
With these steps in mind, you’ll be well-prepared for the exciting journey of purchasing your own property. For more detailed information read our step-by-step guide to buying a house.
The three main stages of buying a house are:
Conveyancers are vital in the house-buying process, as they handle all the legal aspects of the purchase, such as property searches, contracts, and transfers of ownership. They are also responsible for making sure the process goes through smoothly and should be on hand to guide you through the complexities.
The timeline for each stage can vary when buying a house but typically is:
From mortgages and insurance to viewings, offers, exchange and completion, our Buyers’ Guide will take you through everything, step by step, from start to finish.
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