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Help! I want to buy a house and don't know how!

Chickabiddybex
Chickabiddybex Posts: 1,346 Forumite
Tenth Anniversary Combo Breaker Savvy Shopper!
in House buying, renting & selling
I'm confused about the order in which things happen. At what point would I apply for a mortgage? How do you time receiving the mortgage with actually buying the property?
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Comments

  • notanewuser
    notanewuser Posts: 8,499 Forumite
    Get Approval in Principle from a mortgage broker or your lender. This will tell you how much you can borrow.

    Find a house within budget. Expect to need a 10% deposit. Appoint solicitor, apply formally for mortgage. Pay any set up and valuation/survey fees. Get mortgage offer. (This may or may not be for the amount you need.)

    Sign legal paperwork. Solicitor will arrange exchange of contracts. They will need your deposit at point of exchange and you'll need buildings insurance from that date too. Completion date agreed.

    Solicitor will arrange draw down of mortgage funds and on completion day your deposit plus mortgage will pass to the sellers. House is now yours.

    Pay solicitor, set up utilities etc.
    Trying to be a man is a waste of a woman
  • SG27
    SG27 Posts: 2,773 Forumite
    notanewuser wrote: »
    Get Approval in Principle from a mortgage broker or your lender. This will tell you how much you can borrow.

    Find a house within budget. Expect to need a 10% deposit. Appoint solicitor, apply formally for mortgage. Pay any set up and valuation/survey fees. Get mortgage offer. (This may or may not be for the amount you need.)

    Sign legal paperwork. Solicitor will arrange exchange of contracts. They will need your deposit at point of exchange and you'll need buildings insurance from that date too. Completion date agreed.

    Solicitor will arrange draw down of mortgage funds and on completion day your deposit plus mortgage will pass to the sellers. House is now yours.

    Pay solicitor, set up utilities etc.


    Just to clarify something here that confused me. The deposit that you pay to your solicitor on exchange is not the same as the deposit for the mortgage. On exchange of contracts you have to pay 10% of the purchase price.
  • julieb1987
    julieb1987 Posts: 246 Forumite
    the 10% is the deposit on the house. The mortgage will pay for the other 90%. You need to do lots of research before you start the process. There are lots of books about. Go to your local library.
    First Time Buyer: Mortgage Offered, Searches complete, Exchanged 21/12/2012, Completion 04/01/2013! :beer:
  • DuckEggGingham
    DuckEggGingham Posts: 315 Forumite
    SG27 wrote: »
    Just to clarify something here that confused me. The deposit that you pay to your solicitor on exchange is not the same as the deposit for the mortgage. On exchange of contracts you have to pay 10% of the purchase price.

    ? Does that mean technically we need two lots of 10% saved? This is honestly the first time I have heard of this.
    Save 8k in 2013: Member #100
    £450 / £8000
  • notanewuser
    notanewuser Posts: 8,499 Forumite
    SG27 wrote: »
    Just to clarify something here that confused me. The deposit that you pay to your solicitor on exchange is not the same as the deposit for the mortgage. On exchange of contracts you have to pay 10% of the purchase price.

    What are you talking about? It is the same.

    You need at least 10% of the purchase price as a deposit, plus a few £k for solicitors, stamp duty (if applicable) and mortgage fees.
    Trying to be a man is a waste of a woman
  • notanewuser
    notanewuser Posts: 8,499 Forumite
    DuckEggGingham wrote: »
    ? Does that mean technically we need two lots of 10% saved? This is honestly the first time I have heard of this.

    No, it doesn't. I don't know what that poster is on about!!
    Trying to be a man is a waste of a woman
  • DuckEggGingham
    DuckEggGingham Posts: 315 Forumite
    notanewuser wrote: »
    No, it doesn't. I don't know what that poster is on about!!

    About had a mini heart attack then :eek: lol Thank you!
    Save 8k in 2013: Member #100
    £450 / £8000
  • SG27
    SG27 Posts: 2,773 Forumite
    DuckEggGingham wrote: »
    ? Does that mean technically we need two lots of 10% saved? This is honestly the first time I have heard of this.

    No you don't. Say for example you had a 20% deposit. You would pay 10% to your solicitor on exchange of contracts and the remaining amount on completion.
  • SG27
    SG27 Posts: 2,773 Forumite
    notanewuser wrote: »
    What are you talking about? It is the same.

    You need at least 10% of the purchase price as a deposit, plus a few £k for solicitors, stamp duty (if applicable) and mortgage fees.

    No it's not the same. I have a 50% deposit, I'm not paying 50% on exchange it's 10% (normally).
  • notanewuser
    notanewuser Posts: 8,499 Forumite
    SG27 wrote: »
    No it's not the same. I have a 50% deposit, I'm not paying 50% on exchange it's 10% (normally).

    You're comparing apples with pears.

    The above posters are unlikely to be putting down more than 10%.

    It is the same deposit, you're just paying it over in 2 chunks instead of 1.
    Trying to be a man is a waste of a woman
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