Stepping out on the property ladder for the first time can leave you feeling shaky on your feet. It’s certainly not as easy as handing over the cash and making your new house a home. The road towards property purchase is littered with hidden costs; most of them extremely expensive sums of money. A lot of these hidden costs are unavoidable, so it’s always good to have money put aside to meet these charges.
When you choose your mortgage, always choose with care. You could find yourself with undue bills. Some providers guarantee 100% loans, but they are likely to charge you a great deal more interest. If you can, try to provide a 5% or 10% deposit, at least.
Although it doesn’t sound like it, stamp duty is a tax on buying property. For properties up to the value of £60,000, you pay nothing. After that, the percentage of stamp duty goes up, depending on the price of your purchase.
Checking the Property
It’s wise to pay for a basic survey, which should point out any flaws in the property that you might have missed. This will cost you £300, but sometimes you can get this free through some mortgage lending companies. A full structural survey will set you back a lot – £800, or more for larger properties. This appraisal will uncover the less obvious faults with the property, which can sometimes be substantial.
If the survey does show up any faults, you’re in a safe position to ask for discounts on the property’s price. Also, a full survey is expensive and should be extensive, so if the surveyor misses faults in the property, you have a strong case for suing him or her.
Valuation usually entails a quick visit, just to check that the property isn’t being sold at an extortionate price for what it is. Sometimes, your mortgage lender will provide a valuation free of charge. If it has to come out of your pocket, the valuation should cost less than £150.
Conveyancing is crucial to the buying and selling process. You will need to hire property solicitors to handle this business. Your conveyancer will conduct local authority research and sort out the Land Registry. When it comes to choosing your solicitor, it’s usually best to go with personal recommendation. Otherwise, obtain several quotes, before you make your choice.
The cost of conveyancing usually goes up or down, depending on the price of the house. Expect extra fees, such as stamp duty and Land Registry to be paid by you, on top of your conveyancer’s wages.
You can attempt to conveyance your own property, but it really isn’t recommended, as the work can be very stressful and time-consuming.
When the contract is agreed, you must put down a deposit. This is normally 10% of the property’s value. Those under a 100% mortgage will have this paid for them.