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Things to consider before buying your first home


Purchasing first property is gratifying and emotive, but it can be expensive and stressful too. There are different sentiments that can be experienced while purchasing your first property. These are few things that you need to consider before buying your first home so that your experience is optimistic.

Mortgage

When purchasing your first house, you will need mortgage. Which means you will be committing to pay a monthly repayment to the lender as part of the agreement to borrow the money you need for your property. If you fail to pay back in time, you will be at risk of having your property recuperated.

It is tremendously important to understand that you are economically tied down when you have mortgage. You can sell your property if it becomes too uncomfortable for any reason, but this will add to your expenses and can be costly.

Check your credit score

Don’t apply for mortgages before checking your credit files at the main agencies are error-free.

Small mistakes can cause rejection. For example, active accounts registered to old/wrong addresses can hurt badly, so whip through your credit files and ensure any active account (even historic and unused) is registered at the correct address.

Valuation fee

This is the fee lenders charge for valuation to check the property exists and it also offers sufficient security for the loan.

Legal fees

Many lenders will contribute to legal fees, although in that case you would have to use a solicitor approved by them. If you pay for your own conveyancing, you are looking at about £500-£800, depending on purchase price.

Stamp duty

If you are buying a property for more than £124,999 then you will have to pay stamp duty land tax on Its purchase price.

Removal costs

Unless you can pile up your belongings into the back of your car, factor in a removal van. It can cost up to £1000 for shifting a family’s possessions long distances.

Home repairs

Keep some cash aside to repair those leaky sinks and get the paint work done again. Expect to undo everything and do 10 other things you didn’t expect to do.

Furniture and extras

If you are currently renting a furnished place then remember you’ll need to buy everything from beds and sofas to lawnmowers and carpets.

And there are boring but essential things: lamp, door mats, hooks and extension leads.

Furniture and extras

If you are currently renting a furnished place then remember you’ll need to buy everything from beds and sofas to lawnmowers and carpets.

And there are boring but essential things: lamp, door mats, hooks and extension leads.

Deposit

Once you are contented with having a mortgage and know the commitment that you are signing up for, it’s worth thinking that how much money you would like to pay as down payment.

Normally, fist time buyer aims for 10% but it will only increase your load, high mortgage rates which may not be financially sensible over the years that you are paying back your repayments.

If you have enough time and can wait to increase your deposit, to get a better mortgage deal, this is something you should consider, as it will be financially beneficial in long term.

Government schemes

The government has two different schemes to help the people struggling to buy a home. The Help to Buy scheme and New Buy are available to buyers with a deposit of between 5% and 20% of the property’s value.

If you are a first-time buyer aged 18-39, you get up to £32,000 from the Government by opening a new Lifetime ISA, which launched in April 2017.

You can save up to £4,000 a year into the LISA either as a lump sum or by putting in cash when you can. Then the state will add a 25% bonus on top if you use it towards your first home (or retirement). So, if you save the full £4,000 you'll have £5,000. And that's before interest or growth.

You need to have had the LISA open for at least 12 months to get the bonus cash for your first home. If you need to buy within a year of opening one, or you’re over 40, then use a Help to Buy ISA instead.

Walk around neighbourhood

No matter how lavishes the pad, Money savers are common that location counts. Moving a home to another spot is not possible, but we can do it up.

So, walk around the neighbourhood. Visit the parks and clubs at different times of a day. Is surrounding neat and clean? Do you like the local shops?

Squeeze them for info

Before taking the keys, pose as many questions as possible – and get answers in writing. Nothing is silly. If they don’t tell the truth, you may notice them wriggling when you broach subjects.

Here are few questions to ask:

  • How many offers has it had?
  • How many viewers till date?
  • How long the lease is (if it has any)?
  • What renovations have been done?
  • Ask for gas and electrical reports.
  • How old is the boiler and when was it last serviced?
  • Any disputes with neighbours?
  • What’s included in sale? Wood burner? Curtains?
  • Who lives around?
  • Any parking issues.
  • What’s the council tax band?
  • Has any mishap happened there?

Use our checklist to spot deal breakers

Don’t waste your money on a survey only to discover obvious problems. For second or third viewings, take an expert to get an honest opinion of the property and price.

Small issues like a broken window or broken kitchen drawer shouldn’t be deal breaker. But make a list, so that you can ask the seller to fix before you get the keys.

  • Spot damp
    Case the joint for wet spots, peeling wallpaper and condensation on windows. Check inside cupboards too.
  • Open doors and windows
    Also shut every door behind you as you’re being shown around to make sure they all work. Don’t forget to open cupboards and drawers. Remember you are paying them possibly £100,000s.
  • Check ceilings
    Look for cracks, brown stains, slow drips, and problem leaks.
  • Flick switches
    Turn lights on and off. Fire up the cooker. Also check the wiring’s age, as updating electrics can cost large.
  • Inspect the plumbing
    Turn taps on and flush toilets. Check cupboards beneath sinks are dry. Check water pressure that it gets hot.
  • Locks
    Check windows for locks and the front door for break-in signs.
  • Lift mats and rugs
    Check for stains on mats and rugs, and another nasties underneath.
  • Turn on your phone
    Check for a signal to confirm it’s not a mobile dead zone.
  • Avoid kitchen nightmares
    In the kitchen, preparing dinner. Is there enough room?
  • Enquire next door
    If buying a flat or terrace, alarm bells should ring if neighbours’ properties are run down. Their problems can become your problems.
  • Vet the seller
    If they strike you as unreliable, think twice. A property is not good value if the vendor doesn’t want to sell it. You could waste thousands in fees.

Knock! Knock! knock on neighbours’ doors

Neighbours can offer tip-offs on the area or home. And it is also a chance for you to get the measure of them. Chat to neighbours nearby, but not next to, the property. They will be honest about what the area is like.

Resale potential

If you don’t want to stay at the property until you die, consider ease of resale.

This may be your dream home, you may live with walking through the kitchen to get to the bathroom, but will others?

Find cheaper conveyancers

Conveyancing is the legal process of transferring the property from one person to another. As well as solicitors, there are licensed conveyancers, who are specialist property lawyers. They do all the legal work like land registry and local council searches, draft the contract, and handle the exchange of cash.

Few dos and don’ts

  • Don’t go for rock bottom price if you are in a rush: the cheapest companies often work in bulk and can be slower. If time’s an issue, that can be a problem.
  • Do check for hidden add-ons: ask for complete breakdown. Do they include bank money transfer fees, stamp duty forms, land registration fees?
  • Don’t hesitate: make sure you completely understand what your legal advisor will and won’t do on your behalf.
  • Do check they are regulated by a professional body: solicitors are regulated by the Law Society and conveyancers the Property Law Regulator. They must have a clear complaints procedure in place.
  • Do check what needs to be paid if a sale collapses: if a sale falls through, lawyers will often charge a fee for work done even if it was the seller who pulled out. Some firms offer a “no move, no fee” but this may not cover things like search fees which are paid out on your behalf.

Ask for them to ‘take it off the market’

Make your offer on the condition that the seller “takes the home off the market”. This cuts the chance of gazumping, where the seller accepts another higher offer after the sale has been agreed.

Chase your solicitor

To put it politely, some solicitors work at their own pace. Make regular phone calls to get papers processed quicker. Remember, you are paying them. If they don’t meet your expectations, try writing to a senior partner.

Fittings and fixtures

To avoid getting the keys to a stripped-bare house, ask seller to give you the list of all fixtures and fittings included, right down to the light fittings, the black bin, and the fire grate. Yes, one unlucky forumite found all these ripped out.

Know when and if you can opt out of purchase

You can opt out from the purchase at any time before contract is signed. After this, you can’t change your mind without spending.

Visit auctions

Auction properties can be cheaper than market values. There are properties out there for under £25000, but auctions don’t equal bargains. Research is always required.

If you are planning to bid, go to some auctions first to know more about the process. Visit properties.

Always recruit a solicitor to inspect the auction pack. If you buy a property with major legal issues that need sorting, it may not be the bargain you thought it would be.

Get the right survey done

There are two types of survey. The first is a homebuyer’s report. This costs around £350 and is suitable for conventional properties less than 50 years old.

For older houses, consider a full structural survey. These are detailed, cover everything, and can cost up to £1200, but worth the expenses. It could well give you ammunition to bargain the price.

Unhappily, even those buying new builds will have to spend from their wallet. Catching surveys pinpoint defects and unfinished bits, so you push the developer to fix them before completion.

Quotes for work

If survey finds any nasties, ask for repair costs by a reputable builder. Ask the vendor to either fix it before completion or knock the total off the price.

Do get a second opinion, especially with damp. What might seem like minor work can be complex and expensive.

Flood risk

Flood risk has a significant impact on insurance premiums and a property’s value. Visit Gov.uk and Environmental Protection Agency to request reports on whether and why an area is at risk.

This can disclose how susceptible a property is, saving years of tension.

Questions to ask sellers

Your life will be at peace if you remember to ask the previous owner all the essential questions before you take the keys. Few questions that you can ask:

  1. Where are the gas and electricity meters?
  2. Where is the main stopcock?
  3. What time of the day do the dustmen come?
  4. Where did the kitchen and bathroom tiles come from?
  5. Does any surface need special cleaning products, example wooden floors?
  6. Who supplies the energy, broadband and home phone?
  7. Where did any repaired furniture come from?
  8. Where is the thermostat?

Home insurance quotes

Get home insurance quotes before signing the contract, to ensure suitable cover’s available. This could flag up the issues like flood.

Dirt busts

You could find house manky when you arrive, so if possible, tackle the grim a day before moving in.

Gas leaks

At least thirty people die every year and around hundreds are admitted to A&E due to poisonous gas that has no colour, smell or taste.

Ensure that you get a copy of the annual Gas Safety Certificate, which shows that all gas appliances have had a service by an engineer listed on Gas Safe Register, before moving in.

Save on gas and electricity

You will have to start paying for energy as soon as you move in. It can be cheaper if you switch to another supplier instead of sticking to previous owners’ energy supplier. Those on energy providers’ standard tariffs can save £100s a year by switching.

Free sofas, beds and more

Furnishing your new home? A lot of top quality goodies are available daily for free. It’s all about web communities, and the big names like Freecycle and Freegle.

There’s no catch. Instead of dumping goods or selling them online, people use the web power to offer them to their local communities.

Of course, there is some moth-bitten tat out there. But there is also top-quality stuff people just don’t use anymore. Bagging the best is all about the etiquette – you need to give yourself and keep your eyes peeled.

Don’t buy your lenders’ mortgage life assurance

If you die, mortgage life assurance ensures your dependents needn’t worry about repaying the mortgage. Policies are designed to pay off the remaining debt on repayment mortgages if you die within a set number of years.

Free insulation

If the home you are going to move in isn’t properly insulated, you may get free loft and cavity wall insulation.

The total cost, including the building work, can be worth £700, according to Energy Saving Trust.

Rent out

If you have an extra room which you won’t be using, rent it out to a lodger and take home £7000 a year without paying a penny in tax. You can earn more if you have a desirable property and don’t mind paying income tax.

Save on boiler cover costs

Nothing can be worse than arriving home when its freezing to discover the central heating is packed up and there’s no hot water. Everything flies out the window while you desperately search for someone to fix it.

Instead of waiting until it gives up the ghost and paying over the odds for emergency repair costs, make getting your boiler cover sorted part of the moving-in process.

Leasehold and freehold

It’s important to know the difference between leasehold and freehold when looking to buy a house.

Freehold is when you own the property outright and leasehold is when you own the property for a set amount of time, anywhere from 40 years to 999 years (depending in how long you wish to live), like a long-term rent if you will. With a freehold, you own the property and the land it’s built on and it’s on your name. with a leasehold, although cheaper than a freehold, you don’t own the property and you do not free control to do as you please to it (contracts vary). To be on safer side, make sure you know whether the house you are looking for is freehold or leasehold before further considering it as sometimes it is not stated clearly in the ad.

You’ll be victorious!!

Once you get to the other side, owing your own house feels pretty darn great!


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