1. Finding a property you can afford

Plan your purchase and take into account the costs that come along with buying a property, whether that be the mortgage, agent fees, or legal fees. Ask yourself questions like:

  •  Can you keep up to dates with your payments if your situation changes (ie. extra bills, if you lose your job, changes in interest rates)? 

  •  Have you taken into consideration the fees of the property or fees like moving costs, legal fees, lender fees, removals and broker fees? 

Find an area you want to live in within your budget and take multiple viewings even if it seems unnecessary. This will help give you to get a taste of what you can get for your money.

2. Choosing your mortgage and checking your credit report

When buying a property, check your credit report, as lenders take this into consideration to see if you are making your payments on time. IFA (Independent financial advisors), mortgage brokers and lenders can help you find a mortgage.

3. Making an offer

Once you find the property for you, make an offer. This will usually be done through an estate agent where you will not have to pay any fees unless you’re selling (0.5% + VAT to 3% + VAT of the selling price).  (0.6% inclusive VAT to 3.6% inclusive VAT) 

When making an offer make sure you don’t forget any important details. If you’re investing, you probably won't have to sell a property to buy; if you’re buying without a mortgage, there’s one fewer thing to cause an issue; if you're applying for a mortgage, then attach your DIP (Decision in Principle) to show you can get your finances.

4. Arranging a solicitor and surveyor

The solicitor will handle the legal work around the property. The surveyor will survey the property to check for problems, which might affect the cost of the place you are planning on buying. Then a Valuation survey is carried out by the lender to determine whether or not the property is worth the price you’re paying before they approve the mortgage.

The Property Survey is an optional survey with several types. They look at the hidden costs of the property and could lead to a price renegotiation. There are several types of surveys available: 

  • RICS Condition Report - Cheapest of the surveys which does a brief overview of the property. Particularly ideal for new builds and conventional homes in good condition.

  • CS homebuyer report - Suitable for conventional properties in reasonable condition. This is a much more detailed survey as they evaluate both the insides and outsides of the property. It also includes a valuation.

  • Building or structural survey - The most detailed and suitable for all residential properties. Particularly important for much older homes that may need repairs.

5. Finalising the offer

Once the surveys are complete, prices for buying a property may be negotiated:

  • The survey of your choice may reveal some issues which may cause the value to be negotiated down.

  • The lender may have undervalued the property, leading to an increase in price. You can either leave the offer (fees will still have to be paid), or it may even be negotiated to another buyer for a higher price. This is known as “Gazumping”.

6. If things go wrong

In difficult times, it’s worth the effort to form and build a strong communication with the seller via your estate agent and solicitor. Situations can possibly be rescued and solved by keeping communication. 

7. Finalise your mortgage

Once you’re ready to buy a property and happy with your mortgage, you can contact your lender or broker to pay the arrangement fee to process your mortgage. Some people add this to their mortgage which means you’ll have to pay for interest on it. Once you have received your offer, you’re given an optional 7 days to see if this is the right option for you. Use this time to compare different offers and opportunities. You can also let them know if you’re sure about this offer and let them know before the 7 days end.

8. Contract signing

Summarise your offer and check the details before signing. Once you reach this step, you and the seller have a committed agreement. Therefore, the seller may ask you to have a holding deposit, typically £500 to £1000, to show intent.

9. Exchange contacts

Keep communications with your seller and cover your property with building insurance. 

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