Buying a property is the biggest financial commitment you will ever make. This is a guide to help you understand the maze of property sales process:
Work out how much you can afford
Before you start your property search, you must consult mortgage adviser or even a lender to work out your maximum possible loan. This is based on how much you earn and the size of your deposit. You should aim for at least 5% of the value of the property but preferably more. Mortgage lenders will usually lend up to 3 or 4 times your annual income (before tax and national insurance).
Search for a property
Register with local estate agents and property portals like Rightmove and FindaProperty. Don't restrict your search to just one street. Try to widen your search a little and you could still find your perfect home in the right location. Location is key, so do your research. UpMyStreet can help with background information about your chosen area, the Home Office for crime statistics and the BBC for house price movements. PropertySnake keeps track of reduced house prices across the UK. You can also use HousePrices.co.uk to check out what properties in the neighbourhood are selling for.
Register with a solicitor or licensed conveyancer
One of the best ways to find a reputable solicitor or conveyancer is through personal recommendation. He or she will carry out all the legal work required for buying your property. Prices vary but look for one that is not over-worked or inexperience. You can also check The Law Society for names, then call a few to ask for a quote.
Make an offer
When you've found the right property, call the estate agent and put in an offer, but you do not have pay the asking price. You can offer less but before you do so, do your homework. Use some of the following as a bargaining tool:
- Are there others that are interested in the same property
- How quickly does the seller need to sell
- How long has the property been on the market and have there been any reductions
- Are there any works that need to be done
- Do you already have an agreement in principle with a lender
Your offer should be made with the stipulation of taking the property off the market. Getting that 'Sold' board outside is a good way to dissuade others from looking. The estate agent would also need your solicitor's details at this point, so have it ready.
Arrange your mortgage and valuation
If you haven't already made an mortgage application with a lender either direct or through a mortgage broker, now is the time to do so. Once an application is made and checks carried out, you can usually find out if it was successful, in principle, within 24 hours. Upon success, a valuation is carried out to establish that the property is worth the asking price. A fee is payable for this survey. If the lender is happy with the results, a formal offer will be sent to you within two weeks.
Sign and exchange contracts
Unless some legal complications are uncovered, your solicitor will present you with the contract to sign. This will also be signed by the seller and then exchanged. The deposit is then payable to your solicitor. Note that this is non-refundable if you were to pull out. Completion is when the mortgage is passed on to the seller and you are given the keys. This normally takes between 2 to 4 weeks. But for various reasons, some choose to exchange contracts and complete on the same day.
Time to move!