Step-by-step guide to buying your first home

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Step-by-step guide to buying your first home

first-time buyers starting their home buying journey
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    Buying a house or other property for the first time can be a daunting prospect so it’s vital you understand the financial implications of homeownership.

    This step-by-step guide takes you through the process from spring cleaning your finances to picking up the keys to your own home.

    Looking to buy your first home? Get in touch with Simmonds Mortgage Services for comprehensive support tailored to first-time homebuyers.

    What does the house-buying process look like for first-time buyers?

    Buying a house or flat is the biggest financial commitment you’ll make in your personal life, so let’s look at what you need to do from deciding to buy to what happens on the completion date.

    Step 1: Getting your finances in order

    The first thing to focus on in the home-buying process is ensuring that your finances are in good shape before you apply for a mortgage.

    You can get a credit report from a credit checking agency, which will show you if there are any areas of your credit history that need attention. Start to clean up your credit file at least 6-9 months before you plan to make your mortgage application.

    Make all payments for loans, credit cards, store cards or other agreements like mobile phone contracts on time. If any of your accounts are overdue, bring them up to date.

    Gather your documentation together including bank statements, payslips or self-employed business accounts.

    Ensure your name appears on the electoral register, as this will be checked by mortgage lenders.

    Once your finances are tidy, you can get an agreement in principle. Many lenders will give you an idea of how much you can borrow using an online form. This is not a formal mortgage offer but can show the seller that you are a serious buyer and have sufficient funds for the purchase.

    To learn more about improving your credit, check out our blog.

    Step 2: Finding the right property

    When you are ready to start house hunting, visit the local estate agents in person to explain exactly what you are looking for in your dream home. As your search continues, it’s a good idea to keep in weekly contact with the estate agents so you are top of mind when an appropriate property comes on the market.

    Finding the right house or flat can take time and although there’s usually a compromise to be made somewhere on your criteria, don’t be rushed into making a decision to buy a house that you might regret later.

    Property search websites are also a great way to find your ideal house as you can filter by house prices, area and other criteria such as number of bedrooms etc.

    Step 3: Making an offer

    Once you have found the property you want to buy, it’s time to get your offer accepted by the seller. You can make an offer below the asking price if you want to save money. The seller does not have to accept a lower offer, but they might if they are keen to sell quickly. As a first-time buyer, you may be an attractive buyer – you can move quickly as you won’t already have a property to sell.

    After your offer has been accepted, it’s time to make your formal mortgage application. The mortgage market is ever-changing, so it’s worth talking to a mortgage broker who will be aware of the best mortgage deals for your circumstances. The broker should help you complete the application and present all the supporting documentation to the lender so you can get your mortgage agreement.

    Mortgage companies require you to pay for a house survey to check that the property is worth what you are paying for it. You could also choose to do a full structural survey, which is a much more detailed survey showing any issues to be aware of. A comprehensive survey can cost up to £1000, so be sure to factor this into your moving costs.

    Lenders also require you to purchase building insurance, which starts on the date you exchange contracts. Home insurance could also include contents cover to protect you from fire, theft or other damage. You may also be offered indemnity insurance, which protects you against a legal defect with the property that either can’t be resolved or would be very costly and/or time-consuming to do so.

    Step 4: Instructing a conveyancing solicitor

    Your seller’s solicitor will deal directly with your solicitor regarding the legal process of your house purchase. This includes doing property searches, dealing with Land Registry, paying the stamp duty and managing the title deeds.

    Step 5: Exchange contracts

    The process of exchanging contracts happens when the buyer and seller’s solicitors swap signed contracts. At this point, you’ll need to pay a deposit. How much deposit depends on the contract but it’s commonly 10% of the agreed sale price. This legally binding contract means you will soon be a homeowner.

    Step 6: Completion and moving in

    Completion of property purchases usually happens a few days after exchanged contracts but it is possible for exchange and completion to happen on the same day. You can pick up the keys to your new property once all the money has been received by the seller’s bank. You are now on the property ladder – congratulations!

    Looking for a mortgage? Get in touch with Simmonds Mortgage Services

    Simmonds Mortgage Services provides comprehensive support to those buying a house for the first time. Contact 01184 693037 or book a meeting with an experienced mortgage adviser for help finding the right mortgage product and best interest rates for your first property purchase.

    Frequently asked questions about buying a first home

    Can you negotiate a house price with an estate agent?

    The estate agent works on behalf of the seller, so although you can negotiate through the agent, the seller has the ultimate power to decide.

    Will I need to communicate with the mortgage provider, or does the mortgage broker do that for me?

    Your broker can handle the communication with the mortgage lender on your behalf.

    How long does an affordability check take?

    An affordability check can take a couple of weeks. The lender will ask for evidence of your income and outgoings and will decide if they think you can afford to pay the mortgage at the current rate. They will also do a stress test to ensure you will still be able to afford the mortgage if mortgage rates increase.

    Do I have to pay stamp duty as a first-time buyer?

    First-time buyers pay no stamp duty on properties with a purchase price up to £425,000.

    What costs should I budget for?

    – Mortgage deposit (at least 10% of property price or as big a deposit as you can manage to save)
    – Solicitors fees
    – Property survey fees
    – Mortgage arrangement fees
    – Removal companies fees

    Do I have to pay for an Energy Performance certificate (EPC)?

    No, the seller is required to provide the EPC to you as the buyer.

    Picture of Andrew Simmonds

    Andrew Simmonds

    Andrew Simmonds is the managing director at Simmonds Mortgage Services. He's been providing mortgage advice to home owners for many years.

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