What to save for before buying a home

smallstu16_2

*Newbie post*

Can anyone offer me any advice into what I should save before Buying my first house.
I know I need to save for the deposit 5-10% but what are the additional costs?
Such as mortgage fees, surveys and such I need a list so I can calculate how much more I need to save.

Regards
Stuart
:snow_laug

nmiah786

Mortgage Survey Fee
Stamp Duty
Convayance Fee
Removal Cost

frugglewump

Stamp duty will be a % of the purchase price

When I was looking at the key worker homebuy they said they expected you to be able to find £3500 to cover all legal costs and stamp duty

cattie

Well solicitor's fees need to be on your list. It's best to get a few quotes from different solicitors, as the fees they charge can vary enormously. It's a help too if you can get someone to recommend a solicitor they have used.

If you are buying a leasehold property the legal costs are a bit more than for freehold as there is a lot more work involved. Also if you do buy a leasehold property remember to factor in the cost of the maintenance each month.
If the vendor is in credit with his maintenance or ground rent charges then these will have to be repaid to him as part of the sale process.

You need to factor in the cost of buildings insurance once you've completed on a property, as this will be required by the mortgage lender. Sometimes on a leasehold property it is included as part of the maintenance charge. On a freehold property you have to arrange your own.

The survey you've mentioned & you will just have to decide which of the 3 choices of survey to go for. If it's a new property the valuation survey should be fine, costs around £100. Next is the homebuyers survey which is a bit more comprehensive, costs vary from area to area, but I paid £375 for my last one. The most comprehensive of all is the full structual survey, costs can be £1500 or more, but is money well spent if you are thinking of buying a very old or very rundown property.

Depending on the price of the property, there may be stamp duty to pay. This is payable at 1% on properties with a selling price of £120 000 up to £250,000 and at 3% on properties between £250,000 & £500,000.

Properties under £120,000 have no stamp duty liability. Also,there are certain areas considered "deprived" by the government where stamp duty applies only to properties above £150,000

Sometimes a vendor will offer items such as curtains/blinds & furniture or white goods from the property for sale & you can usually negotiate a price for these if you are interested. It's best to negotiate & pay separate from the selling price, otherwise you will pay stamp duty on the whole amount.

I'm sure someone else will soon come along & think of other things to add to your list. It's a costly old business is buying property.

socks_uk

I want to thank you for your info cattie, I too didn't really know the costs involved. Well, that's not strictly true, I did know roughly what was needed but you have clarified it.

What I would like to ask though is... at what point do the specific 'bills' have to be paid?

My situation is this...
I have my house up for sale right now and it is mortgage free.

I want to buy a house more expensive and so will have to get a mortgage for the difference.

I have very little spare cash right now (saving about £50 a month) and hope to use some of the capital from the sale of my house to pay for removal and legal fees and to pay off a small bank loan and credit cards so I become debt free except for the mortgage.

Is there anything, to do with either selling my house or buying the new house, that will require money 'up front'? And if so, can they be put onto my credit card to be then paid off?

Jill

P.S.
I have done my homework and seen an IFA and I can afford the monthly repayments on a new mortgage as the monthly payments will be less than I'm paying out on my loan and credit cards. It's just 'up front' ready cash I don't have.

smallstu16_2

Great Stuff, guys This is just the sort of info I need!

frugglewump

socks_uk wrote:

Is there anything, to do with either selling my house or buying the new house, that will require money 'up front'? And if so, can they be put onto my credit card to be then paid off?

Well I can answer some of this for buying. So far:
- our solicitors have asked for the land search fee up front and the rest to be paid on completion.
- the bank said the fee for the valuation survey was to be paid upfront (as a non FTB maybe you can get this added onto the mortgage)
- the surveyor has said they send an invoice for any extra survey - homebuyers / structural - so it may be upfront it may be within 30 days of receiving the invoice

BenL

Mortgage product reservation fee, Our A&L one is £499
Survey Fee - Homebuyers report £460
Stamp Duty
Solictors costs - ours are just under £900

smallstu16_2

So here is my total list so far, can anyone anything missing?
1, Mortgage Valuation
2, Mortgage arrangement fee
3, Conveyancing costs
4, Search
5, Land Registry
6, Homebuyers' survey
7, Lenders' (structural) survey

$17mma

smallstu16 wrote:

So here is my total list so far, can anyone anything missing?
1, Mortgage Valuation
2, Mortgage arrangement fee
3, Conveyancing costs
4, Search
5, Land Registry
6, Homebuyers' survey
7, Lenders' (structural) survey

Possible stamp duty?

frugglewump

BenL wrote:

Mortgage product reservation fee, Our A&L one is £499

Huh, now that's one no-one has told me about - although we do have a completion fee of £30 to pay when the mortgage is drawn out. Is that something that has to be declared in the agreement in principle or can it be added on when you agree to apply to the mortgage.