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  • FIRST POST
    • mattb87
    • By mattb87 16th Mar 17, 7:13 PM
    • 17Posts
    • 2Thanks
    mattb87
    Buying A New Build - Steps Involved
    • #1
    • 16th Mar 17, 7:13 PM
    Buying A New Build - Steps Involved 16th Mar 17 at 7:13 PM
    Hi all,

    So I am a first time buyer, looking to buy a new build house (off-plan). I'm trying to get the whole process straight in my head. I've put together a first draft of the steps involved as I think they will occur. I'd be super super grateful if people could review it and suggest improvements if I have something wrong!

    Thanks




    Reserve property with developer
    Complete Help To Buy Application
    Contact A Conveyancer / Solicitor
    Contact Mortgage Broker To Find Mortgage lender & mortgage
    Survey?
    valuation?
    Solicitor reviews contract?
    I sign contract and deliver it to developer where we exchange and pay deposit. At this point, completion date is agreed.
    agree options/upgrades with developer and pay for them
    Completion -> instruct solicitor to transfer funds ?
    snagging list?
    pick up keys from developer
Page 1
    • alex_163163
    • By alex_163163 16th Mar 17, 7:16 PM
    • 103 Posts
    • 64 Thanks
    alex_163163
    • #2
    • 16th Mar 17, 7:16 PM
    • #2
    • 16th Mar 17, 7:16 PM
    realised I didn't explain myself properly on my original post! What I meant was, at the time of reservation make sure you know what is included and try negotiate for extras to be thrown in 'free' as incentives e.g. Flooring to be included, back garden to be turfed, kitchen upgrade etc.
    Also ask if the developers will pay the stamp duty is a common incentive.
    Last edited by alex_163163; 17-03-2017 at 7:10 AM.
    • ceecee1
    • By ceecee1 16th Mar 17, 7:22 PM
    • 355 Posts
    • 777 Thanks
    ceecee1
    • #3
    • 16th Mar 17, 7:22 PM
    • #3
    • 16th Mar 17, 7:22 PM
    Check and check again if it is leasehold or freehold. If it is leasehold get it in writing to show how much the ground rent is, how often it increases and by what amount.

    There is a whole host of people who now own houses which are unsellable as they have leases which double every 10 years. They face having to pay either £9k a year in ground rent or upwards of £40k to buy the lease.

    Depending on the developer some people even have to pay the leaseholder for permission to change the carpets or the colour on the walls.

    Google national leasehold scandal for more information
    • Chanes
    • By Chanes 16th Mar 17, 7:22 PM
    • 809 Posts
    • 500 Thanks
    Chanes
    • #4
    • 16th Mar 17, 7:22 PM
    • #4
    • 16th Mar 17, 7:22 PM
    Leasehold or Freehold? If it is a leasehold property you could join this group for advice, there seems to be some serious issues with new Leasehold properties. www.facebook.com/groups/786983251448976/
    • alex_163163
    • By alex_163163 16th Mar 17, 7:26 PM
    • 103 Posts
    • 64 Thanks
    alex_163163
    • #5
    • 16th Mar 17, 7:26 PM
    • #5
    • 16th Mar 17, 7:26 PM
    Also, finding out if you can get a mortgage needs to come higher up the list. You can't really reserve a new build until they know you are in a proceedable position - i.e. You have the deposit and can afford a mortgage. They will likely ask you to speak to their associated mortgage broker to assess this first. But please be aware you don't have to choose this company to apply for the mortgage through.
    I would always recommend using independent mortgage broker and solicitor, not the ones the developer suggests. Even though the developer may offer you incentives to use theirs.
    The broker will also apply for the HTB loan for you.

    You should be getting quotes from solicitors from the outset too. When you reserve the plot, they will ask for your solicitors details. You can change them but would be easier if you know who you are going to use when you reserve I've found.

    Also with an off plan new build, you will likely not agreed a completion date until much further down the line. Exchange will be pushed for within 4-6 weeks of reservation, but completion will be on notice. Do you know when it is due to be finished being built?
    • kingstreet
    • By kingstreet 16th Mar 17, 10:03 PM
    • 31,166 Posts
    • 16,630 Thanks
    kingstreet
    • #6
    • 16th Mar 17, 10:03 PM
    • #6
    • 16th Mar 17, 10:03 PM
    This is the way we do Equity Loan cases in England;-

    Check HCA Affordability Calculator
    Obtain agreement in principle
    Preliminary reservation done with builder and solicitor selected
    Property information form and reservation submitted
    HTB - EL Authority To Proceed issued (ATP)

    All the above is done in the first week.

    Formal reservation completed and fee paid
    Full mortgage application submitted
    Lender valuation done and supporting docs submitted
    Mortgage Offer issued
    Solicitor submits Authority to Exchange (ATE)
    Contracts exchanged with completion "on notice" when build over

    All of the above is done within 28 days of ATP issue.

    Property finished and kitted out to buyer's spec
    Demonstration visit and snagging inspection
    Notice given
    Solicitor submits Forms 1 & 2 for Equity Loan release
    Completion takes place, keys and money change hands and mortgage payments commence.

    All of the above several months later and can be upto nine months from ATP, upto six months from ATE.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • allthe7s
    • By allthe7s 17th Mar 17, 6:13 AM
    • 69 Posts
    • 269 Thanks
    allthe7s
    • #7
    • 17th Mar 17, 6:13 AM
    • #7
    • 17th Mar 17, 6:13 AM
    Options and upgrades on a a new build must be agreed at the same time as you reserve!
    Originally posted by alex_163163
    Not necessarily - we haven't had to yet. The mortgage gets agreed and survey done 1st, our options meeting hasn't even been arranged yet.
    Next £615 £495 £436.23 Santander1 £297 £279 £261.95 Santander2 £84 £79 £75.11

    Savings Goal £163.67/£3000 by Dec 17
    • ap1985
    • By ap1985 17th Mar 17, 4:13 PM
    • 323 Posts
    • 128 Thanks
    ap1985
    • #8
    • 17th Mar 17, 4:13 PM
    • #8
    • 17th Mar 17, 4:13 PM
    Hi all,

    So I am a first time buyer, looking to buy a new build house (off-plan). I'm trying to get the whole process straight in my head. I've put together a first draft of the steps involved as I think they will occur. I'd be super super grateful if people could review it and suggest improvements if I have something wrong!

    Thanks


    Originally posted by mattb87
    Speak to a mortgage broker and Get an AIP
    Reserve property with developer (usually require a £500 reservation fee)
    Complete Help To Buy Application - mortgage broker can do this if they are specialist in the new build market
    Contact A Conveyancer / Solicitor
    Developer will complete a reservation form which will be sent to the solicitor and your mortgage broker
    The mortgage broker will do a full mortgage application with the lender which is suitable and most lenders will take a valuation fee at the start of the application and instruct valuation through the mortgage process
    Please note the developer will require exchange in 28 days but your solicitor should know this if they are experienced with help to buy
    the solicitor will then review contract and a copy of the mortgage offer and help to buy offer should be sent to him. You will be called in to sign the contracts and pay the deposit at this stage to the solicitor who will then send it to the developers solicitors. With new builds usually you get a vague completion date as we did and this was confirmed by notice of completion closer to the time it was due to be completed.
    Any upgrades should be agreed with the developer before completion and any incentives from the developer before exchange as this may have to be disclosed to the mortgage broker.
    Upgrades will have to be paid directly to the developer.
    When the solicitor receives the notice of completion from the developer they will request funds from the lender and transfer them to the developers solicitors. If you have signed all documents you won't be needed at this stage. After the funds have been transferred over you will be able to pick up your keys from your developer. My husband and I did our snagging the same day we picked up our keys and let them know of any issues. It is always advisable to do this as soon as possible.
    Hope this helps. If you have any further questions let me know as my husband and I have just been through the whole process ourselves recently. Good luck with it all
    Finally going to be a homeowner
    • Futuristic
    • By Futuristic 17th Mar 17, 4:40 PM
    • 720 Posts
    • 360 Thanks
    Futuristic
    • #9
    • 17th Mar 17, 4:40 PM
    • #9
    • 17th Mar 17, 4:40 PM
    Not necessarily - we haven't had to yet. The mortgage gets agreed and survey done 1st, our options meeting hasn't even been arranged yet.
    Originally posted by allthe7s
    You really should be discussing options before, now they control you and the prices. They could double prices on every option and you won't be able to negotiate.
    • allthe7s
    • By allthe7s 17th Mar 17, 4:53 PM
    • 69 Posts
    • 269 Thanks
    allthe7s
    You really should be discussing options before, now they control you and the prices. They could double prices on every option and you won't be able to negotiate.
    Originally posted by Futuristic
    They gave us a book with the prices of all the upgrades so they can't change the prices.
    Next £615 £495 £436.23 Santander1 £297 £279 £261.95 Santander2 £84 £79 £75.11

    Savings Goal £163.67/£3000 by Dec 17
    • Katiejane13uk
    • By Katiejane13uk 27th Mar 17, 10:49 PM
    • 7 Posts
    • 1 Thanks
    Katiejane13uk
    I have set up national leasehold campaign Facebook group.

    Do.not buy ANY leasehold property. It's a national scandal.

    MP's describe it as legalised extortion and the next PPI scandal.

    It's a mess.

    Developers will sell your freehold onto greedy 3rd party investors and then u become someone else's long term investment. Don't do it. !!!
    • Lazarus Blackstar
    • By Lazarus Blackstar 27th Mar 17, 11:16 PM
    • 118 Posts
    • 202 Thanks
    Lazarus Blackstar
    Started reading this thread thinking Steps were actually involved in buying a new build! Sorry but I couldn't resist!!!

    "The truth is of course is that there is no journey.
    We are arriving and departing all at the same time."

    • Chanes
    • By Chanes 28th Mar 17, 12:06 AM
    • 809 Posts
    • 500 Thanks
    Chanes
    I have set up national leasehold campaign Facebook group.

    Do.not buy ANY leasehold property. It's a national scandal.

    MP's describe it as legalised extortion and the next PPI scandal.

    It's a mess.

    Developers will sell your freehold onto greedy 3rd party investors and then u become someone else's long term investment. Don't do it. !!!
    Originally posted by Katiejane13uk
    I think I beat you to the warning and pointed them at your page too! Good luck, I think a lot of people are watching how this is developing.
    • ceminem
    • By ceminem 28th Mar 17, 7:50 AM
    • 129 Posts
    • 36 Thanks
    ceminem
    I have set up national leasehold campaign Facebook group.

    Do.not buy ANY leasehold property. It's a national scandal.

    MP's describe it as legalised extortion and the next PPI scandal.

    It's a mess.

    Developers will sell your freehold onto greedy 3rd party investors and then u become someone else's long term investment. Don't do it. !!!
    Originally posted by Katiejane13uk
    To tell people not to buy any leasehold home is responsible, some people know what they are signing up for and RPI linked ground rent reviews are not as onerous as say doubling clauses.

    As always people should do their own research and if they accept the terms then its down to them rather than you telling them not to do it.
    • ReadingTim
    • By ReadingTim 28th Mar 17, 11:24 AM
    • 1,396 Posts
    • 1,957 Thanks
    ReadingTim
    1. research poor build quality of new builds, and the various compensation schemes many developers have had to instigate to affected customers
    2. research the developing scandal that is leasehold property sales
    3. research the downsides to help to buy and other such schemes
    4. research the amount and proximity of the affordable/social housing element of the development to your plot
    5. visit the showhome with a tape measure and realise your normal sized furniture won't fit
    6. buy an already built property on an existing street where you can see what you're buying, where you're buying it and next to whom you're buying it
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