Buying a House - order of things to do

TheGame21

Just wanted to get people's views on this. We are first time buyers and therefore new to the whole thing. Do people get a mortgage offer before they make an offer or do they make an offer first then get a mortgage? I was thinking if you got a mortgage offer first and then that offer was rejected you would have to get another mortgage.

However is there any implications on getting another mortgage offer if you already have one and what happens if you following second option and get a mortgage offer after you have made an offer on the house and you cannot get a mortgage? Is there a time limit you need to get one by?

kingstreet

Get an agreement in principle first, if you want confirmation of your credit worthiness or maximum borrowing power. You don't make a formal application for a mortgage until you have a purchase price agreed and a solicitor appointed.

kingstreet

This is the bigger house purchase picture;-

Offer agreed
Solicitors instructed
Sales memorandum issued by agent
Purchaser applies for mortgage
Vendor's solicitor prepares and issues draft contract
Vendor completes seller's enquiry forms and returns to solicitor
Valuation/survey carried out
Purchaser pays solicitor for searches
Searches requested
Renegotiation of price due to survey findings - if required
Mortgage offer issued
Purchaser's solicitor receives seller's enquiry forms and raises any enquiries
Searches returned
Responses to enquiries
Purchaser visits solicitor to go through paperwork, hand over ID and deposit
Completion date agreed between all parties
Contracts exchanged
Completion takes place.

One or two happen out of order and things can happen concurrently to save time.

TheGame21

Thanks for the responses. If we make an appointment with the bank, should they be able to give us a clear indication of how much we can borrow. I don't mean the calculators on websites but the actual amount of what can be borrowed?

getmore4less

The most important one.

Budget, work out what you can afford.

Two elements, cash needed up front, and monthly outgoings.

that may be less than how much they will give you.

Some bits will be estimates till you find a the place. but you can make them fairly close.

Velvet_Glove

When you go to the bank, make sure you are definitely eligible for a mortgage from them. i.e. in terms of work contracts. Most will happily give you an AIP but when it comes to the crunch and they find you're on a fixed term contract they can get a bit funny. We've been caught out by this twice - ask before you apply!