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. Click here to find out which is the right option for you.
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? Each has its' own advantages and disadvantages. Check out our guides on these subjects areas.
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 affordable home ownership government schemes.
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.
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.
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.
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.
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.
Exchange contracts
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.