First time buyer advice

DCFC79

WelshWonder91 wrote: »

So a broker would deal with all the solicitors, surveys and mortgage application on my behalf but if I didn’t use a broker I would have to do all that myself? Is it hard to deal with solicitors and surveyors?

Nope, the broker will find the mortgage thats best for you eg best deal.


You deal with the solicitors etc.

rescynic

WelshWonder91 wrote: »

Hi all, I’ve been browsing over the forums for a while and thought this would be the best place to come for some advice. I’ve finally decided to buy my first home but I am unsure of the process of applying for a mortgage and buying a property, would it be better to start a mortgage application first or start viewing properties first? Also any other advice of buying a first home I would gladly accept. Hope I’ve posted this in the right place.

"would it be better to start a mortgage application first or start viewing properties first?"

When we started the process of buying our house (We are waiting for exchange of contracts) we picked a budget we could afford and had a deposit for (we started our search at £120k) then went to a mortgage broker and got AIP/ DIP for that amount, we also asked what the max lendable was which now gave us our "budget range" from there we started our house hunt in earnest.

a few tips we've picked up along the way:

H2B/ LISA

if you have a H2B ISA or LISA make sure you tell the broker and solicitor upfront and when your shopping around ask them if they have experience of getting the bonuses (a few of the ones we spoke to didn't) also make sure and ask the solicitor you do go with when in the process you should draw it down (it takes them 10-14 days to get the bonus from the government (basically when you close the ISA/LISA you will get something called a closing statement you give to your solicitor who then applies for the bonus money from the government, this is then added to your deposit pot.)

Getting help from family for the deposit

If you are getting any help from family make sure and tell your mortgage broker and solicitor upfront you have an element of "gifted deposit" (ask your mortgage broker/ solicitor if they have a template letter for this bit) our solicitor had a mild panic when we said family were giving us help with the deposit, our mortgage broker was a legend and gave us a letter template that in effect said "I <insert name here> am giving my <Son/daughter/relative> the figure of <£X> towards the deposit for <property address here> this is a gift not a loan and I will have no interest in the property" the mortgage company/ solicitor may give you their own form to fill in for this bit.

So I found a house I quite like what next

Once we found a house we were interested in, we spoke to several solicitors, got some quotes (ask them for a first time buyer conveyancing quote) and picked the one we liked the most to act on our behalf.

When you want to make an offer you ring or email your solicitor and say I want to make an offer of £x on property Y and they go away and do all that for you, or you can ask them to give the other side a ring and get the lie of the land before you decide on a figure to offer. (Don't worry they aren't scary people and we have found our contact at the solicitors to be extremely helpful)

Once you get that amazing phone call from the solicitor to say
your offer has been accepted the shock will subside and the oh !!!! what's next kicks in.

1) call your mortgage broker and get started on the mortgage application process (this will take a few weeks) you will as a minimum have to provide 3 months bank statements, 3 months wage slips, proof of identity, address and anything else related to your application or as requested from the mortgage company during the process. You will then get an email, call or text to say mortgage approved and offer is in the post.

the offer is then sent to you and your solicitor and that's your mortgage broker done their bit and are no longer involved in the process and it's all down to the solicitor peeps (from our experience so far anyways) Read the mortgage offer carefully, is the amount being borrowed correct? do you have to do anything before completion (For us before completion we have to get home insurance sorted for the new property).

2) the solicitors will go off and start the searches and do their legally bit, This all happens in the background and it will go all quiet for a while, So for us we are sending a wee email to our contact just to see how things are progressing, it might also be worth keeping in contact with the seller to see how things are going from their side (might flag up any issues and keeps everyone honest).

3) I understand the next stage is exchange of contracts/ missives. Which makes it all official that you are buying the property and the seller is selling it to you. (we haven't made it to this stage yet so will report back when we get to it)

From what I understand up to this point either party can pull out of the sale! my understanding is until you have exchanged no contract to buy the property exists, thus no obligation on either party.

4) at some point after item 3 and before item 5 you will be asked to hand over deposit monies and maybe even to pay your solicitors, from what I've read its also a good idea to get home insurance sorted for your new house at this stage (its a requirement of our mortgage offer) then its onto the exciting stuff "Completion".

5) Completion I believe this is where the money exchange hands behind the scenes, the mortgage company release the funds to your solicitor who pay it forward to the sellers solicitor, other stuff happens and the keys appear and its all done.

One thing we were a little unprepared for is the additional costs, mortgage broker was £300, legal and mortgage fees around £1500) so I'd advise adding a couple of grand to your "pot" for unforeseen costs. If you don't need it all, or any of it then welcome to the bonus round! but better to be prepared just in case.

sorry for the wall of text, hope the above helps you out (as we move through the next bits of the journey I'll drop back and update as we are in the searches/ just before exchange stage just now) I apologise if anything above is incorrect and I'm sure if anything screams out as wrong someone with more experience can amend accordingly.

best of luck on the journey.

george4064

I'd recommend having a look at the 'Important Threads' page which links to several guides about first time buying, buying flats, mortgages etc...


Link here: https://forums.moneysavingexpert.com/discussion/4930313/house-buying-important-threads

Bollo2019

00ec25 wrote: »

never ceases to amaze me how, on a housing forum, so many posters do not know the difference between:
- to borrow
and
- to lend

a mortgage is not money you have loaned, it is money you have borrowed.

That's your only contribution on a thread from a FTB asking for help and advice?

My advice is get a mortgage broker, they'll seek out the best deal for you and take away some of the legwork in getting it processed. Get your AIP and from that point you can then understand what price range of houses you can look for.

Bollo2019

ACG wrote: »

You can get a Decision in principle (also known as a DIP/AIP/MIP) but personally I would avoid getting one of these until you have found somewhere if possible. Some estate agents needs them before allowing you to view properties, but they do expire, it can involve a credit check and some will also display how much you can lend - which can be used against you when negotiating the purchase price.

How could it be used against you in negotiating the purchase price?

s_glover

Bollo2019 wrote: »

How could it be used against you in negotiating the purchase price?

If the estate agent is aware of how much you can borrow, they know what your upper limit is. if you offer below this, they may advise the vendor to push for more money.

WelshWonder91

Wow so many replies, thanks to each and everyone of you for taking the time and effort to post advice I really do appreciate it and I will take it all on board...no doubt I will keep coming back to re-read things everyone has posted and figure out where to go next