Taking steps towards buying your first home is a hugely exciting time, not to mention the wonderful achievement of making that significant investment in your future.
Many people dream of the day they can buy their first property, but when you finally have the means to make it happen you might be feeling slightly daunted by what’s ahead.
If you haven’t been through it all before, you might not know quite what to expect. Sometimes things don’t go quite to plan, but there are things you can do to protect yourself from being caught out. Our job is to help make sure the purchase of your first property goes swimmingly, so we’ve put together some top tips to keep you in the know, and to help you avoid some of the common mistakes…
Know all the costs and include them in your budget
Research suggests that 84% of buyers underestimate the additional costs of moving home, meaning many fail to budget for them appropriately. Make sure you give ample consideration to the following:
- Stamp duty
- Valuation fee
- Any fees associated with your choice of mortgage product
- Surveyor’s fee (and any subsequent repairs needed)
- Solicitor’s fee
- Removal costs (or van rental)
If you’re a first-time buyer, you won’t need to pay estate agents’ fees. These are usually paid by the seller.
Be well informed about your mortgage options
It’s not always the best idea to simply go ahead with the lender who is willing to provide the largest mortgage amount. You might find that pending further investigation these lenders may not fully cooperate with your interests, and you’re left with a mortgage you cannot afford. This could possibly lead to financial problems, so make sure you do your research and get some different views. There are lots of online mortgage calculators that can help you get a good picture of your borrowing range. Your estate agent may offer helpful advice, but it’s a good idea to shop around independently too.
Don’t mistake the property report and valuation for a survey
People who are taking their first step on the property ladder sometimes mistake the property report for a survey. It’s an easy mistake to make – the property report is usually fairly detailed and provided by your solicitor. However, you will need to pay separately for a survey of your property to be carried out by a Chartered Surveyor, especially if you are having a mortgage. This will provide you with an expert’s opinion on any potential issues with the building you need to know about, so it’s worth spending the extra money. Surveys come in different forms and these vary in the level of detail. The basic mortgage valuation commissioned by your lender simply confirms that the value of the property is appropriate given the location of the property and the type of property itself. It is advisable that you should not rely on this valuation alone in any prudent purchase.
If you are in any doubt about which survey would be appropriate you should discuss this with the surveyor or your conveyancer.
If you’ve been saving with the government’s Help-to-Buy ISA scheme, getting that extra 25% bonus from the government can be very helpful. However, there are some misconceptions about what you can use it for. You aren’t able to put the bonus towards the deposit on the property: the bonus will only be granted once contracts have exchanged and you are legally committed to the purchase of the property. This means you will need to find the full amount for the deposit yourself.
Another thing to bear in mind is that you cannot use the scheme to purchase a buy-to-let property – and if you’re caught circumventing this rule you could be ordered to repay the government.
Always ask questions
At any point in the process of purchasing a property, if there’s anything you don’t understand or are not sure about, you should always ask. It’s also a good idea to do some digging yourself about the property and the neighbourhood – ask around about any known issues in the past, or anything that could be coming up. Of course there’s a lot at stake in a property transaction, so make sure you know your stuff every step of the way – it could prove invaluable.
Choose your solicitor wisely
When money is tight, as it is for many first time buyers, it can be tempting to opt for the very cheapest Conveyancer or Solicitor you can find. However, it is essential that you are cautious of the cheapest deals, as the most appealing rates can often result in hidden costs and poor service. Selecting a trusted and experienced solicitor could save you a lot of stress later on.
We understand that buying a property can seem complicated, especially if it’s your first time – it’s likely you’ll have a lot of questions, and you need a trustworthy conveyancing solicitor who is on hand to answer your queries. That’s why excellent customer service is at the heart of our business at Bird & Co. You can be sure our friendly and understanding experts will be at your side from start to finish. If you’re a first-time buyer and need assistance, or you just want to discuss your options, give us a call today.