There’s a lot to think about when when you buy a home. But don’t worry, Homemove is here to help. This step-by-step guide will take you through the process, from deciding what you can afford and where you want to live, to signing the contract and moving in. So let’s get started!
Finances
The first thing you need to do is make sure your finances are in order and work out how much you can afford. If you need to get a mortgage to buy a home then you will need to know how much you can borrow. The amount of money your mortgage provider is willing to lend you will depend on a few factors such as, your credit score, how much deposit you have and your income. The average amount they will allow you to borrow is usually between four and four and half times your salary. You are more likely to have access to better mortgage deals if you have a bigger deposit.
You should also work out how much you can afford to pay back each month. If you are unable to pay there could be consequences and your credit score can be affected.
Additionally, remember that there are extra costs that you will need to pay for when buying a home such as a conveyancer, mortgage fees, surveys, and more. So, it is important you work out your finances and have enough money to pay for fees before buying a home.
Research and decide where you want to live
You now want to research where you want to buy a home. It is important to make sure you find an area that meets all your needs. The best way to start is by making a list of potential areas you would live and do research on each area. You need to decide if you want to live in a quiet area or not? How many bedrooms do you want? Do you want to be near local transport and schools? Is the area at risk of flooding? What are the crime rates like in the area? Deciding what you want from an area and researching them will help you pick the best for you.
Mortgage in principal
The next step is to get a mortgage in principle. This is when a lender puts into writing how much they would be willing to let you borrow. If you have this in place you will look reliable to a buyer as they will know you are serious about buying. Also having a mortgage in principle will help you get an idea on how much you can afford to spend.
View properties
You can now start to view homes you are interested in. This will allow you to get a feel for each home and see which one is suitable for you. Viewing houses can be exciting and you want to make the most out of your viewing. If you would like a checklist for viewing a home you can use ours here. Remember, you can view a property more than once, so don’t worry if you don’t manage to do everything on the checklist at the first viewing.
Make an offer
Once you have found a home you like, the next step is to make an offer, you agent will be responsible for passing on all offers. It can be hard to decide what price you want to offer, do you want to offer the asking price or below the asking price? Your estate can help you and give you advice on what they think is best. But, remember at the end of the day it is the buyers decision on what to offer.
It is quite common for a buyer to offer the seller below the asking price of the home, usually between 5-10% lower to see if the seller will accept. However, if there is a lot of people interested in the property then there is the chance the lower offer will be rejected and you will have to put in a higher offer.
Before making an offer you can do some research into what properties in that area have sold for before. This will help you with an offer and allow you to decide what’s the highest you will go with your offer.
Hopefully the offer you put it will be accepted so you can move onto the contracts and making the sale legally binding.
Applying for a mortgage
You had a mortgage in principle but now you need to apply formally for your mortgage and complete the process.
Some documents you may need to provide are:
- Proof of income
- Proof of address
- ID
- Bank statements
Choosing the right mortgage for you can be hard so it is always best to ask for advice if you need it. Like mentioned above the amount a mortgage provider will lend you depends of different factors. Something you need to consider is how long you want to spend paying it back. A lot of people choose to spend 25 years repaying their mortgage. However, some people choose 30 years or more as the monthly costs will be less if you spread them over more years.
Hiring a conveyancer
You will need to hire a conveyancer to help with the legal process of buying a home. They will sort out the contracts and transfer the ownership of a property. There are things you should consider before hiring a conveyancer such as, what fees they charge and their experience. You can read more about what you need to know before choosing a conveyancer in our blog post here.
House survey
If you wish, you can get a RICS survey done on the house. RICS is the Royal institute of Chartered Surveyors. This survey is different to a mortgage valuation. You can choose between a level one, two or three survey, depending on how detailed you want it.
The survey will look at the condition and structure of the home. It is a good idea to get a survey done so you are aware of any problems with the home, so you don’t have to spend loads of money later on making repairs you weren’t aware of.
Signing and exchanging contracts
The next step is to sign and exchange contracts. This is when the sale of the property becomes legally binding. There are a few things that need to be sorted before you sign and exchange the contracts, as you can loose your deposit if you back out of the sale after exchanging contracts.
You need to make sure:
- Yourself and the seller have agreed on a completion date
- Your mortgage has been confirmed
- That you have the deposit ready
- You have organised building insurance
- Anything the survey uncovered has been sorted
If everything is ready to go and you are happy, you can sign the contract. Your conveyancer will then exchange the contracts with the sellers conveyancer.
Hire a removal company
Now you have your completion date you can hire a removal company if you need one to move your belongings. Do some research first to find out what type of removal is best for you. Removal fees depend on a variety of factors, but on average usually cost between £420 and £1,800. If you would like to read more about the different types of removal services you can hire then have a read of our blog post here.
Completion and moving in
Your completion date is usually 7-28 days after exchanging contracts. Although, you are able to exchange and complete on the same day, but this can cause a lot of stress. Completion day is when the rest of the money is transferred through your conveyancer and the sellers conveyancer and the keys are handed over.
You are now able to move into your new home! It is a good idea to have a moving day essentials box which includes everything you will need for you first night. Moving day can be stressful so take a look at our moving home checklist which includes what you should prepare before moving day, who you need to inform of your new address, what to included in your essentials box and the first steps you should take in your new home.
We hope this guide has helped you to understand the process involved with buying a new home and will make it easier for you to move into your dream home!
