Advice and Guidance on Buying your First Home
Buying your first home is one of the most exciting times for any adult. Having a place to ‘call your own’ is one of those moments in life that is never forgotten, especially when you collect the keys, walk through the front door and stare around an empty shell of a property with unlimited possibilities.
However, the purchase of any property can often be a stressful process and doing it for the first time, with no experience, can be particularly fraught, time consuming and draining. However, there is no need to worry. Experienced conveyancing solicitors can help you deal with the legal processes you will face as a first-time buyer. With that in mind, we have put together this comprehensive guide on what to look out for and the pitfalls to avoid when buying your first home..
Mortgage
Very few people are able to purchase a property without having a mortgage and this makes it one of the most important things to research before you start arranging property viewings. In simple terms, a mortgage is a relatively large-scale loan, designed to be paid back over a period time such as 30 years, although this is flexible.
Finding, comparing and choosing a mortgage deal can be a daunting experience, but there is a lot of help you can access to find a mortgage that suits your financial position.
Independent mortgage advisors will be able to help you understand the different products on the market and apply for your mortgage, and the conveyancing team at GA Solicitors in Plymouth is always on hand to recommend a broker or answer any questions related to buying your first home.
Deposit
A mortgage is only part of the funding required to purchase a property. You will also need a deposit.
Most lenders will need a minimum deposit amount of, usually 5-10%, although having more than that can secure you a more favourable deal. 10% is a common deposit amount for first-time buyers. Understanding what this means in real terms can be confusing and it is useful to see a real example to get a clear idea of how much you would have to borrow and how much you would have to save for a deposit when buying your first home. Below we have outlined some examples:
- To secure a property with a £200,000 price tag with a 5% deposit, you will need a £10,000 deposit and a mortgage of £190,000 to make up the remaining 95%.
- To secure a property with a £200,000 price tag with a 10% deposit, you will need a £20,000 deposit and a mortgage of £180,000 to make up the remaining 90%.
Putting the deposit together can be one of the hardest parts of the purchasing process and often means saving over a decent period of time or in many cases, securing financial support from family. Either way, this lump sum deposit will need to be in place before the purchase deal is completed.
Survey
As the purchaser, it is your responsibility to ensure that your new home is free from structural defects or other issues that may affect the value. To do this, you will need to organise a survey of the property.
There are two types of survey, a Home Buyers Report or a full structural survey. A surveyor will be pleased to let you know the cost of each type of survey and talk to you about what they include so you can assess which one is suitable for the property you wish to buy. In addition, the surveyor will also be able to advise you if other more specialist reports are needed to give you the full picture.
Whilst you are not obliged to have a survey undertaken, if you are carrying out a survey this should be done before exchange of contracts. After exchange of contracts you are committed to the purchase and any defects that you find after exchange will be your responsibility and could come as a nasty shock.
Although surveys can be expensive, they are important as they’ll give you a detailed understanding of the true condition of the property before you commit fully to the purchase. The results can help you to decide whether to progress with the purchase, negotiate the price further or to in fact walk away from it.
It is important to be aware that, in normal circumstances, you cannot rely on a mortgage valuation survey carried out by your mortgage lender. All this valuation does is confirm that your new home is worth the amount that your mortgage lender is prepared to lend. The valuer will not necessarily be looking for structural defects and instead will focus on what they think the property is worth. Therefore, you need to consider having your own surveyor to look around the property.
Some mortgage lenders will allow you to pay extra and ask the valuer to undertake a survey for you at the same time as the valuation, which will mean a survey that you can rely on. Your lender will be able to advise you if this is possible.
Our experienced solicitors will work through the process with you and highlight any possible issues to increase your chances of a smooth and quick purchase.
Budget
Buying your first home is an expensive process and there’s more to it than just the price you pay for the property. Budgeting properly will help you avoid any unexpected costs and any potential delays throughout the process.
Some of the additional costs you may face as a first-time buyer include:
- Survey costs, including valuation (dependent on the level of survey required).
- Legal fees and disbursements.
- Removal costs.
- Buildings insurance (a requirement as part of the mortgage).
- Initial works, decoration and furnishing costs.
- Mortgage arrangement fees (often added to the mortgage but that will incur interest).
- Stamp Duty (only payable for first-time buyers on purchases over £425,000).
What this demonstrates is that budgeting with true costs is vital as it will prevent significant headaches further down the line.
Wills
As a first-time buyer, you’re probably not thinking about getting a will in place but the truth is, it’s worth doing, especially as you’re about to purchase a property. Once you’re on the property ladder, your house becomes a significant asset and you need to think about what happens if the worst was to take place.
Having a will in place helps you control what happens with your home, so a conversation with the wills, trusts and probate team here at GA Solicitors is definitely worth progressing.
Conveyancing
Conveyancing is the legal process that oversees the correct transfer of property ownership including undertaking searches, contract preparation, exchange, completion and the handling of the large sums of money involved. This is not a small task. In fact, it’s one of the most important parts of the whole process to make sure that the legal requirements are met.
Choosing the wrong conveyancing lawyer can not only slow the process down but put your investment at risk.
There are many important tasks of a conveyancer. This includes raising enquiries as to what is and is not included in the property sale, determining any works that have been undertaken on the property and ensuring sufficient regulations and permissions are in place, as well as undertaking essential local searches such as:
- Land registry title searches
- Local authority searches
- Environment searches
- Drainage and water
Your conveyancing solicitor will be the go-between, between you, the estate agent and the seller’s solicitor. A lot of correspondence is often needed between all parties to agree timescales, sale value and additional extras, like the purchase of any furnishings already in the property.
Having a legal expert on hand to help navigate the property purchase process is vital and at GA Solicitors in Plymouth we’re hugely experienced at handling conveyancing for first-time buyers. We understand that it can be stressful and difficult to navigate which is why we will be your port of call throughout the process. Our team will talk you through any complexities involved in your purchase and are equipped to deal with any additional requirements, such as if you are considering purchasing a leasehold property as opposed to a freehold property.
It’s our belief that conveyancing is not just about handling everything from a legal perspective, but also about being there for you when buying your first home. We steer you through the complexities of ‘buying a house’ so you can get on with ‘making a home’.
Our Plymouth-based conveyancing team work on a fixed-fee basis and deliver an exceptional service. If you’d like to talk to one of our award-winning solicitors, please contact the team directly on 01752 203500 or email enquiries@GAsolicitors.com.
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