First Time Buyers
We hope to answer some of your questions here at Shire Financial Services, however the best way to be sure is to meet one of our professional mortgage advisors to discuss your situation and needs. One of our Personal Mortgage Advisers will help you through the process step-by-step, working out how much you can borrow, how much it will cost, and what type of mortgage may be most suitable for you. If we are right for you, we will arrange your mortgage and any insurance needs you may have. The average fee we charge is £200, which is invoiced upon mortgage offer. Please see our Initial Disclosure Document for further details, or get in touch if you have any further questions.
Finding & Choosing a Property
Choosing a Property
- The number of bedrooms you require.
- Whether you need a garden.
- Whether you prefer a house, bungalow or a flat.
- Are you looking for a detached, terraced or a semi terraced?
- Whether you require an old or a new property.
- Do you need a garage?
- Do you want a good school nearby, convenient local transport links, convenient shops or restaurants?
Bear in mind the following when considering a bigger property:
- They cost more to buy.
- Cost more to heat.
- Cost more to maintain.
- Have a higher Council Tax bill.
- Could be a nicer home.
A newly built home should require less upkeep in the first few years. You may never find one property that is absolutely ideal in every respect so be prepared to trade off one factor against another as you look around. For example, you might be prepared to live in a cheaper area if that meant being able to afford a garden. Always consider whether you can afford the buying price but also the living costs such as insurance policies, council tax, water rates, heating, maintenance and other on-going costs.
Finding a Property
Once you have decided what sort of property you are looking for, the area where you want to live and how much you can afford, contact as many local estate agents as possible. A property may only be on the market with one agent.
You may miss your ideal property by not registering with all agents. Ask the agents to send you details of suitable properties on a regular basis. Some agents will call each week with details of the properties they have just taken but others you will need to chase.
Once you get started, you will probably see a lot of different properties in a fairly short period of time. Keep a record and a few notes of each property you have visited to remind you of its good and bad points. Then you can look back on these notes to check that you are still fulfilling your requirements. Once you think you have found the right property make a list of questions and things you want to check then arrange a second visit.
Finding & Choosing a Mortgage
Choosing a Mortgage
It is important to consider your Mortgage when you start to look for a home. There are lots of things to consider when choosing a mortgage and there are many lenders and hundreds of mortgages to choose from.
You should apply for your mortgage as soon as you think you have found a suitable property. The loan may take a few weeks to process, and the person you are buying from (and the estate agent) will want to know your mortgage lender is all set to go. It will also give you control and certainty.
You can start to arrange your mortgage finance before you’ve even found a property; you can get an “Agreement In Principle” from your chosen lender. This Approval is often handy to convince the vendor that you are a genuine purchaser. It also confirms that the lender has found your details acceptable and that you have passed their credit scoring.
It does not guarantee that a mortgage will be offered. When the full application is made further information may have an adverse impact on the application or the lender’s criteria may have changed however it is unlikely for the full application to be rejected if an AIP has been given.
Finding a Mortgage
There are two ways you can find a mortgage. The approach you choose will depend on the kind of person you are.
- The first way is to shop around among the different mortgage lenders yourself and see what each has to offer.
- The second way is to go to a mortgage broker, who can search a database of lenders to find a suitable loan for you.
Checklist for choosing your mortgage
Work out how much you can afford to spend on your mortgage and insurance. If this is your first house, you will also need to consider all household costs. We will be happy to work through these with you.
Do you want a fixed rate of interest for the first few years? This can be a help if your finances are stretched and you like the certainty of knowing what your monthly payments will be for a certain period of time. Or would you prefer the potential of a lower interest rate with one of the variable rate products?
Look out for early repayment charges which can make it costly to change lender. Especially look out for early repayment charges that continue after a special rate has finished, which could tie you in to a higher rate of interest.
Will the loan let you take payment holidays if the repayments are likely to become a strain at certain times of year? This is known as a flexible loan and can also be helpful for people whose income fluctuates from one month to the next.
Does the mortgage offer you a cashback lump sum when you first take it out? Loans like this can help you pay for furniture, carpets and all the other things you will need in your new home but normally charge a higher interest rate.
Will you still be able to afford the loan when any fixed-rate or discounted period is over? When special offer periods like this come to an end, most mortgages move to the lender’s standard variable rate which may be significantly higher.
Once you have chosen and applied for a mortgage, the lender will want some supporting documentation.
Evidence of your income and commitments, such as recent pay slips, a P60 and your bank statements.
Information from credit reference agencies, your employers, other lenders and your landlord.
Proof of identity, such as a passport or birth certificate.
Proof of residency such as a utility bill, bank statement, mortgage statement or others.
If you apply for your mortgage through us, we will handle this documentation on your behalf and manage the process with the lender. This is one of the advantages of using a broker to select your mortgage.
We will be happy to advise you over the phone or in person free of charge on all of the above just call 01638 660937 for an informal friendly chat.
Finding & Choosing a Solicitor
Finding a Solicitor
As a first time buyer, you will not have to worry about selling a property before you can move. But you will still need to find an experienced solicitor to carry out the conveyancing on the property you want to buy.
The job of a solicitor or conveyancer comprises the following tasks:
- Obtaining the deeds which prove the property legally belongs to the person you are buying from.
- Researching where the property’s legal boundaries lie and passing this information on to you.
- Preparing a fixtures, fittings and contents list which makes it clear whether or not things like carpets or kitchen appliances are included in the purchase price. This enquiry form will also ask the vendor whether they are aware of any material structural or other defects to the property that you should know about.
- Advising you on a draft contract for sale, prepared by the seller’s solicitor, setting out the terms of your purchase.
- Carrying out a search of local planning information to uncover details of any upcoming developments, such as a new road, which could affect the property’s value.
Agreeing a completion date
Conveyancing may well take longer than you had imagined, but don’t be tempted to rush matters. Your home is probably the most expensive thing you will ever buy, so it is important to be sure there are no loose ends.
Most lenders will be prepared to accept your choice of solicitor, as most experienced solicitors will have acted for the lender in question before. However it can be best to check whether the solicitor is registered and recognised by one of the following two agencies before you get too involved. If they are this is likely to make the conveyancing process much simpler. To check out your chosen solicitor or conveyancer, contact:
- The Law Society: 0870 606 2566
- Licenced Conveyancers Association: 01245 349 599
If you choose and apply for a mortgage through us, we can recommend a conveyancer in your area who we have worked with.
Making an offer
Once you have found the property you would like to buy, the next step is to make an offer, normally through the estate agent. Most sellers build a certain amount of leeway into their price, so it is usual to offer less than the seller is asking. In deciding what you are prepared to pay, bear in mind things like the property’s state of repair and how much you would have to spend on building work or redecoration.
Your first offer might be up to 10% below the asking price. It is then up to the seller to either accept that price, or try to negotiate a higher one. If there are several potential buyers interested in that particular property, the vendor may have enough bargaining power to insist that the full asking price is met. Indeed, in a strong market, the property may sell for a price in excess of the asking price!
If you know that many people will be interested in the property (perhaps because good properties of that type are scarce in the market), and you are very keen on it, you might consider offering the asking price up front to avoid a ‘bidding’ war.
Once your offer has been accepted, the estate agent will confirm this in writing. You can then go ahead with arranging a survey and finalising your mortgage arrangements. The acceptance of your offer is not legally binding until you and the seller exchange contracts.
We will be happy to discuss making an offer with you over the phone or in person free of charge. Remember that the Estate Agent acts for the seller not for you as the purchaser, just call 01638 660937 for an informal friendly chat.
Once your offer has been accepted, a survey is required to assess the property’s condition and value. Your mortgage lender will require at least a basic valuation before allowing your loan to go ahead.
In almost every case, we strongly recommend that you get a more detailed report on the condition of the property to protect not only your lender’s interests, but your own as well. Make sure that the surveyor you use is a member of the Royal Institution of Chartered Surveyors or the Incorporated Society of Valuers and Auctioneers. In addition to the basic valuation there are two further types of survey you can opt for:
- A House Buyer’s Report comments on the condition of only those parts of the property which are easily accessible or visible. The surveyor will recommend any further investigations he thinks are necessary, for example if he thinks the wiring needs checking or there is the possibility of some structural problems. This can normally be arranged with the basic valuation for an additional fee.
- A Full Structural Survey involves a more extensive investigation. A full survey is more expensive than a house buyer’s report, but should tell you much more about any work that may need doing on the property if you buy it. Full surveys are recommended in many cases, particularly if you are buying a property that is more than 100 years old or the building is more than three stories high.
When you view the property yourself, look out for any signs of problems like cracks or damp patches so you can point these out to the surveyor later for him to inspect properly.
When you set out on the home-buying process, you should budget for the cost of more than one survey. You might find the surveyor’s report on your first property uncovers serious faults (such as subsidence or rot) which mean you want to withdraw your offer. Even if there are no problems with the property itself, another bidder could step in with a better offer at the last minute.
Either way, you will have to start the whole process again, and that includes organising a survey for the next property where your offer is accepted.
Where the survey does reveal serious problems, you are free to withdraw your offer. If the problems can be fixed, you may be able to use the survey results to negotiate a reduction in the sale price to compensate you for this extra expense.
We will be happy to advise you on the type of survey appropriate for your purchase whilst arranging your mortgage just call 01638 660937 for an informal friendly chat.
After your mortgage is offered
With your survey safely completed and the lender happy with it, you can move to the stage of getting a formal mortgage offer from your chosen lender which will detail all the conditions of the loan. Read this carefully and get your solicitor or your advisor to explain anything you do not understand.
Your solicitor’s enquiries should be well underway and they should have draft contracts ready for you and the seller to sign. Once contracts are signed your solicitor will be able to exchange contracts on your instruction. On exchange of contracts there is no going back, so be very sure you are happy with all the sale arrangements before you commit yourself.
Typically at exchange (unless exchange and completion are on the same day), you will have to put down a deposit of 5 or 10% of the purchase price. You also need to make sure that the building is insured as you are now legally obliged to buy it (your solicitor will help make sure that this happens).
- Your solicitor has completed all of the local searches.
- The surveyor’s report is complete and accepted by all concerned.
- You have a formal mortgage offer in writing which you have read and understood.
- You have the agreed deposit available.
- You have agreed a firm completion date for the sale, and this date is noted in the contract.
- There are no outstanding issues remaining to be settled between you and the seller.
When you have signed the contract and instructed your solicitor to do so, your solicitor will deliver it to the seller’s solicitor in exchange for the contract the seller has signed. From this point onward, both you and the seller are legally committed to the deal.
Completing & Moving In
All that remains after exchanging contracts is to pay over the money needed to buy the property, less any deposit already paid at exchange, on the agreed date. Your solicitor will get the mortgage funds direct from the lender and the remainder (if any) from you, and then pass it all on to the seller’s solicitor. Once payment has been confirmed, you can collect the keys to your new home from the estate agent.
As soon as you know your completion date, book a removal firm if you need one and make sure they are prepared to provide the level of service you need, e.g. pack your belongings as well as transport them.
Allow yourself plenty of time to pack and label all of your belongings before the removal men arrive. Decide what is going where in your new home and label each container with its contents and the room where you want it to go. Remember to pack important items – such as the kettle – where you will be able to find them quickly and easily.
Two weeks before moving in
During the last week or two before you move in, contact the companies that supply your services to let them know you are moving out.
- Consider asking the Post Office to redirect your mail for a while
- Let the Council know you are moving so that you are not liable for Council Tax payments at your old address.
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Shire Financial Services Ltd
Surrey House, 41 High Street,
Newmarket Suffolk CB8 8NA
Registered Company No.
Country of Registration: England
Mon-Fri: 9:30am to 5:30pm
Sat and Evenings: By Appointment
We receive commission from the mortgage lender. Also, depending on mortgage type and complexity we usually charge a fee between £200-500 and for Expatriate mortgages, a fee of £800. Fees are payable upon Mortgage Offer.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
SHIRE FINANCIAL SERVICES LIMITED IS AN APPOINTED REPRESENTATIVE OF SESAME LIMITED WHICH IS AUTHORISED AND REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.
COMMERCIAL MORTGAGES, INCLUDING BUSINESS BUY TO LET, ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY. FOR COMMERCIAL MORTGAGES WE ACT AS INTRODUCERS ONLY.
THE FCA DOES NOT REGULATE ESTATE AGENTS, SURVEYS AND SOME FORMS OF BUY TO LET MORTGAGES.
FOR ESTATE AGENTS AND SURVEYS, WE ACT AS INTRODUCERS ONLY.
THE FCA DOES NOT REGULATE SOLICITORS AND WE ACT AS INTRODUCERS ONLY.
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