Buying in Scotland - when do I need to talk to lenders?

edinburgher

Excuse the following questions if they seem a bit basic, I'm a FTB and it's been 10+ years since my parents bought anywhere so their memory isn't quite up to remembering exactly how they bought their first home!

My wife and I have started looking for houses and have spoken to a broker who believes that we would be accepted for a reasonable sounding mortgage deal.

When, however, I asked to proceed, he asked me to confirm that we were currently making an offer on a property.

My understanding (or lack of) was that we were meant to speak to lenders in advance of making any offer, get an offer in principle so that the possibility of finance looked likely (I know there will still be lots of underwriting checks to go through) and then view houses with at least some idea that a lender 'liked' us.

Are we doing it the wrong way round? Should we find a house we like, make an offer and *then* contact lenders?

Slightly confused, hopefully someone will point me in the right direction before the broker gets back to me!

kingstreet

Most of us like to get an agreement in principle before someone starts to look, so the client has the confidence of knowing there is going to be a mortgage waiting when they are ready.

Others, notably London & Country appear to not want to do anything until you've decided on a property and had an offer accepted. From their point of view I guess this limits work they might do which they get no benefit from if you later go elsewhere...

edinburgher

Others, notably London & Country appear to not want to do anything until you've decided on a property and had an offer accepted. From their point of view I guess this limits work they might do which they get no benefit from if you later go elsewhere...

We are dealing with L&C (who have been very approachable and have provided a good level of detail so far).

Aside from being slightly less confident when it comes to making an offer (I'd rather have an agreement in principle behind us), is there any disadvantage to looking for properties without one, as the agreement in principle isn't a definite offer anyway?

Thanks for the speedy reply.

kingstreet

Nope. It's a matter of personal choice. Without one, you may get pressure from estate agents "to have a chat with our adviser" but you just have to resist these blandishments with the line "I have an adviser I'm happy with and I'll contact them when I'm happy to proceed."

They have the right to "qualify" an offer when you make one. At this point, get your agreement in principle and provide them with a written copy. That should satisfy the agent's obligations under the EA Act and stop them pestering you as they simply want the income from the mortgage on top of the fee for selling...

googler

kingstreet wrote: »

They (the selling agents) have the right to "qualify" an offer when you make one. At this point, get your agreement in principle and provide them with a written copy. That should satisfy the agent's obligations under the EA Act and stop them pestering you as they simply want the income from the mortgage on top of the fee for selling...

When making an offer in Scotland, you need a solicitor to act for you since the offer must be made in specific legal form.

Most often, the solicitor you hire will qualify your mortgage or buying capability before making any offers on your behalf. They'll also confirm your ID in accordance with money-laundering requirements. Generally, if a buying solicitor states their client is good for the money, the selling agent or solicitor takes them at their word.

edinburgher

Most often, the solicitor you hire will qualify your mortgage or buying capability before making any offers on your behalf. They'll also confirm your ID in accordance with money-laundering requirements. Generally, if a buying solicitor states their client is good for the money, the selling agent or solicitor takes them at their word

I was aware that we'd need a solicitor to make offers etc. So basically our first step should be to find a solicitor?

googler

edinburgher wrote: »

I was aware that we'd need a solicitor to make offers etc. So basically our first step should be to find a solicitor?

Essentially, yes. Plenty to choose from in Edinburgh ....

edinburgher

Misleading name, I'm a Weegie now

A colleague of my wife has said that it's not necessary to engage a solicitor until we want to make an offer. So I guess we start viewings first and make sure we can find somewhere we like...

pokey128

we have just sold/bought in Edinburgh (I say that -missives still not concluded for purchase and sale due to complete today so waiting on tenderhooks for money!)
We spoke to our lender as we wanting to port the rate and got a rough idea from them how much we could borrow. We then viewed some houses and only when we had found one we were interested in did we instruct a solicitor. Once the offer was accepted then we went back to the lender and got our offer.

Good luck

agrinnall

I don't think there's a downside to choosing a solicitor early in the process, it won't cost you any more and they will be ready to act as soon as you find somewhere you like. I have bought 4 properties and sold 3 in Scotland over the last 15 years, using the same solicitor for all of them, and contact her has always been my first action, even before I've started to look for somewhere new.

googler

edinburgher wrote: »

Misleading name, I'm a Weegie now

A colleague of my wife has said that it's not necessary to engage a solicitor until we want to make an offer. So I guess we start viewings first and make sure we can find somewhere we like...

OK, still plenty to choose from in Glasgow.

If you have your solicitor already hired, if you find somewhere you really like, you can offer straight away.

If you find the place you really like (perhaps over a weekend), you have to wait till next weekday to make an appt at solicitor, go through signing up process, etc., then make offer.