The steps of buying a property
Are you considering buying a property? What should you be aware of when purchasing a property? This article will take you through the steps and inform you of the things you should be aware of when buying a property.
Should you be buying or should you be renting?
Before you make your mind about buying a new house, there are important things you should consider. For instance, you should think about whether you can afford it. Secondly, you should also think about whether buying is right for you. For this please see our guide on buying vs. Renting.
Should you sell first before you move into a new home?
Do you want to buy a new property and sell your existing home at the same time? Or do you want to buy a new home and then have to worry about selling your previous one? This has its advantages and disadvantages. Please take a look at our article on whether you should sell your existing home before your purchase another one.
Further, if you have decided to sell and buy at the same time, our guide on in this subject will equip you with the necessary information you need to ensure that the process is error free and quick.
What is your budget?
Budgeting is an important part of the process. You will need to arrange money for the initial deposit which could be 5% to 10% of the sale price as well as the remaining of the sale proceeds. You may also be able to take a mortgage in order to finance buying your new home or may be able to take benefit of some government approved schemes. Please see our guide on ways you can finance the purchasing of property. It will provide you with the information you require to be able to decide on how you can arrange the finances. Our article on the right ty pe of mortgages for you will be useful to you.
Where do you want to live?
Do you want to live close to your existing home? Or do you want to move to a different area? Do your research on where you want to live. You could also consider whether you want to buy a newly built house or buy an existing or older property. Our article on this subject will guide you in deciding in between the two.
Selecting a new property
Once you have finalised the area you want to live in, the next thing you need to do is look for your desired property within that area. Once you come across something you like, it is pertinent that you are also aware of the form of ownership you will be taking up. For instance, if you are purchasing a freehold or leasehold as they are essentially quite different things. See our guide on the difference between freehold and leasehold so that you are fully equipped with the necessary information.
If you are completely sure you want to buy the property, make an offer to the estate agent. You should try to convince the estate agent to take the property off the market so that you are not gazumped, in which case you will not be able to buy your desired property. You can see our article on Gazumping and how to avoid it.
Upon having made an offer, you may be asked to pay a deposit which will be repaid if the sale does not go through. It just shows that are committed to buying.
Financing the deal
In your budgeting process you will have decided on how you will be financing the deal to purchase your desired property; whether you will finance it yourself or be arranging a mortgage. If you have decided on taking out a mortgage, now is the time to arrange it. Your mortgage will need to be in place before you the exchanging of contracts takes places; which ensure that you will be buying your desired property. Our article on exchanging on contracts will provide you with the vital information regarding the things you need sorted before you commit to buying your desired property.
Hiring a solicitor or a licensed conveyancer
The next step in the process is handling the legal and administrative side of buying your desired property. You need to carry out some searches and sort through a lot of important legal paperwork. If you hire a solicitor or a licensed conveyancer, he or she will carry out these processes on your behalf. But do you need a solicitor or a licensed conveyancer?
Though they carry out the same task, but deciding between them depends on a number of factors. If you do not choose the one that best suits your case, it may prove dearly for you.
Surveys and arranging a deposit
Your mortgage lender will require a valuation of your house through a surveyor. However, the purpose of this surveys requirement by your mortgage lender is only to determine whether it is a good property to lend against. In doing so, the survey will be very limited. See what surveys you will need,
The second thing you need to do is arrange a deposit of 10% of the sale price. This amount will be transferred to the buyer’s solicitor or licensed conveyancer upon exchange of contracts, which will bind you to complete the purchase. Exchanging of contracts forms an integral part of the conveyancing process. It seals the deal.
Exchanging contracts will be done through your solicitor or licensed conveyancer. Upon exchange of contracts you will transfer the deposit to the seller.
After exchange of contracts, your solicitor or licensed conveyancer will be file some important documents with the Land Registry which will start the process of formal transfer of ownership of your desired property to your name.
Then you need to agree on a specific date with the seller to complete the sale.
Complete the sale
Completing the sale means the sale the actual sale takes and the remainder of the sale proceeds is transferred to the seller. The house is then yours to move in to. However, the conveyancing process will not stop there. Here is what you need to know about completing the sale.
Please note that the information provided on this page:
- Does not provide a complete or authoritative statement of the law;
- Does not constitute legal advice by Net Lawman;
- Does not create a contractual relationship;
- Does not form part of any other advice, whether paid or free.
We would love to hear what you think about this article and how we could improve it. Please do let us know. However, we shan't be able to reply to your specific questions. If you have a question about a document, please contact us.
If you have noticed a bug or a mistake on this page, or just want to give us feedback, we'd love to know. Nothing is too small or too big. Send your message on this feedback page.