Advice for a prospective first time buyer

TediousPhoenix

Hi,

My boyfriend and I are considering buying our first property, and I was wondering if anyone could answer a couple of questions.

We currently have £50-55k in saving (although we each have about a £10k student loan debt).

We were going to start looking for a place together some months ago, but unfortunately my boyfriend was made redundant. He now has a new job and has been there for about a month - the probation period is 3 months. I'm finding it very difficult to see terms and conditions for mortgages, so does anyone know how long it'd have to be until we could apply for a mortgage given his new job? Could we apply straight away, knowing that finding a house and completing will take longer than 3 months, or will we have to wait for his probation period to officially end?

One thing I'm thankful for is that he got a job working for an out-sourcing IT firm - he could have got contract work. If he had, would we have had to have taken a different type of mortgage - a self-certified one perhaps? There is the possibility that in a couple of years time he could go into this sort of job - you know IT people, never staying in one place for very long!

Also, what is a typical policy for the amount that could be lent to a couple? Nationwide's calculator said it could lend up to £195,000 (not that we want that amount) depending on circumstances when we entered both of our salaries and the cost of a house. But on house.co.uk it said that typically for a couple a lender would lend 'either three times the first income plus one year of the second income, or two-and-a-half times your joint income'.

I'm going to call L&C in a few days to talk to them, but I just wanted to check these things out - I don't want to look silly!

I am currently renting (contract runs out beginning of July) and my boyfriend is living at home. I was thinking it would be nice to *try* to move around then, but I have a feeling I'll be renewing my contract for at least another six months.

I want to sort costs and things out before we start looking. We went into an estate agent a few weeks ago and all they wanted to do was to shove us off to their mortgage broker - that's not what I want. I also want to be in a strong position to buy - I want to be in a position to negotiate on the asking price and use our chain-free position and organisation to do so... to an extent.

I've been trying to work out how much we can afford also. Can you tell me if these estimates are reasonable (for a house worth about £170-210k - we are looking in different areas with different annual work travel costs for us both, hence the large variance... I'm trying to see if we can afford the better area by adding the saving of our travel to mortgage repayments - this stands at about £215/month)?

Arrangement fee 500
Lender's valuation 380
Survey/home buyer's report 750
Legal/Conveyancing Fees 3000
Stamp Duty 2000
Land Registry Fee 300
Local Authority Search Fees 60
Other Search Fees and Disbursements 70
Removal Fees 200


Of course we'd have a contingency, but I'm worried that it's going to be a lot more than that.

I've wanted to buy a house for a long time now, but the more I look into it the more scared I become!

Thanks in advance for your replies.

jonewer

What are your incomes? What is the cost of servicing your student debt?

TediousPhoenix

I'm currently on £21k and my boyfriend is on £25k. He can earn overtime, I can't.

We are currently paying back the minimum repayments to the Student Loan Company via PAYE. My repayments are currently about £45/month. I think my boyfriend's the same.

KiKi

Hi - you can expect these sorts of costs (I posted in another thread, so copied and pasted):


* Solicitors fees - 725 (inc VAT)
* Survey - 3 levels of survey, take your pick! Usually your lender will provide the basic mortgage valuation survey for free. You can also choose to pay for: 200ish for homebuyers, 500ish for full structural.
* Local search - 150
* Land registry search - 6
* Landlord's registration - 16
* Land registry - 150
* Stamp Duty - 1% of purchase price if under £250K.
* Deposit - 10% of purchase price (would not recommend paying any less)
* Bank transfer to transfer deposit - 30
* Leasehold transfer (if buying a leasehold flat) - 80

Plus moving costs if using a removals company.
So you'll need £2000 ish, plus Stamp Duty, Deposit and Removals costs

This is purely from my own experience of house buying, nothing else! But I hope it helps.

KiKi