Confused around house purchase/order

andrewm1981

Hi, I hope someone who knows far more than me can help!

I viewed a property which I love yesterday. It's a unique property (built in 1580) in an urban area. Very hard to gauge value.

It's been on the market for a year at £270k, then came on at offers over £235k. Went to the open day on Saturday, and really liked it, quite a lot of interest. No idea what to offer, offers need to be in by Tuesday at 12!! I think it's worth £260k, but not keen on offering £25k over the asking!

2nd question: I have spoken to my bank, and they would lend me the money hypothetically 2 weeks ago when I asked, but would the fact it's an old property make a difference? I have £60k deposit.


And finally, how does it work? Do I submit an offer, if it gets accepted I then get the surveys done etc. if things crop up that are bad could the price be renegotiated or is the offer legally binding at all?! My heads in a spin, thanks in advance :-)

Andrew

kingstreet

You would normally get a mortgage agreed in principle, before you consider making offers. This ensures you are credit worthy. Once you have an offer accepted, this is the process;-

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.

andrewm1981

Thankyou kingstreet :-)

I spoke to my current mortgage provider (santander/alliance and leicester) who went through about 20 questions about income etc and said what my affordability was. They then said that the next stage was to have an offer accepted on a property then call them back and they'll go through a more in depth telephone interview for an hour. I don't really want to be instructing solicitors if the bank is going to then say that because its old they won't offer me the mortgage! A costly mistake!

kingstreet

Instruct solicitors then ask them to do nothing, until they hear from you.

A lender does not decline a property because it's old. The lender's surveyor will decide if it offers suitable security for the mortgage requested when it does the mortgage report and valuation.

andrewm1981

I understand, just basically ask them to sit tight until I my mortgage is approved. I just read that a lot of the bigger providers won't touch older properties, namely 500 year old timber framed ones. Lets hope with 70% LTV they will :-) now I've just got to figure out what to bid :-) thanks again :-)

kingstreet

As I'm sure you'll be having a more in-depth survey done, ask the surveyor you intend to instruct if they would recommend the property as suitable security for a mortgage, if they were asked to do the mortgage report & valuation.

HelenRachel

Thanks for the list! Very helpful! Also a first time buyer trying to work out what's going on!

agrinnall

OP, you also have to remember that if you pay £250,000 then SDLT due is £2,500, but pay £250,001 then SDLT will be £7,500. So basically you are paying £5K more in stamp duty as soon as you go over the threshold. I'd guess that they have re-priced at £235K in the hope of getting close to £250K, but very few people would want to pay over that.

andrewm1981

Yes, I'll definitely be having the thorough survey done-around £800 I believe. As for price yes, I'll head in just below the threshold and see what happens. Crazy to offer 251 obviously!!

In the offer, (where the vendor chooses the highest offer) I guess I contain a paragraph stating that the offer is subject to the house being of a satisfactory condition after the survey?! I'm not a fan of these sealed bids! :-(

kingstreet

You don't have to be so thorough.

Simply state "offer subject to survey and contract," if you feel it necessary, as it's pretty much a given that is what will happen.