Catie Spink of the Thompson Smith and Puxon Residential Property team discusses what you need to consider if you are thinking of buying a house
The bigger question is probably “How much can I afford to pay”? The majority of people do not have large sums of cash sitting in the bank to buy a property and will therefore need to rely on getting a mortgage.
If you are think of buying a house the first thing you need to do is to get a mortgage agreed in principle with a lender. You can do this by approaching a mortgage company directly or via a mortgage broker. This will take into account the amount of deposit you have and your ability to repay the mortgage. By obtaining this agreement in principle you will know the maximum you can borrow and the maximum you can purchase a property for. Many estate agents will not accept an offer to buy a property without evidence that you either have the cash in the bank or have a mortgage agreed in principle.
Once you know what you can afford to spend on your house, you need to know what other expenses / costs are involved. These are some of the items that you need to account for:
Conveyancers fees – when buying a house most lawyers will charge you a fixed fee for your purchase rather than an hourly rate. The lawyer will also provide you with a free no obligation quotation.
Stamp Duty – this is a progressive tax based on the purchase price of a property. For properties purchased at £125,000 or less no tax is payable.
Disbursements – various searches need to be carried out on the property including a local authority search which, amongst other things, checks to see if the road is maintained by the local council and whether there are any planning permissions or building regulation consents for works carried out to a property; a water and drainage search, to find out whether the property is connected to the main drains and has not been built over a sewer; and also an environmental search, to make sure the property is not in a contaminated area.
Lender fees – your mortgage lender will usually expect you to pay for a survey or valuation to be carried out on the property. This valuation is the most basic survey and simply confirms to your lender that the property is worth the purchase price. We would recommend that a full survey is carried out to ensure that the property has no structural problems.
Once you have added up all the figures you will hopefully be ready to find a property to call your own and can start viewings in earnest. When you have found the perfect property you will be in a position to make an offer via the estate agent and you will be able to show them your agreement in principle and evidence of your savings.
When your offer is accepted you will need to instruct a conveyancer to act for you in the legal work and this is where we can help. If you would like more information please contact Catie Spink, GCILEx, at Thompson Smith and Puxon Solicitors on 01255 254258 or by email at firstname.lastname@example.org