First time buyer? We've got you
Being a first time buyer can be overwhelming, but don't worry, we can help. We will support you through the process, and make sure you understand how mortgages work and what options are available to you. A great place to start is understanding how much you could borrow & what your monthly payments will be. If you are ready to take the first steps with us, please get in touch.
The process for buying your first home
You know how much you can borrow in principle, you have your deposit ready, now what? Read on for a high level breakdown of what to expect from the process of buying your first home
Your first property search
You set up email alerts on Rightmove, Zoopla, OnTheMarket, to name a few. There are alternative sites now such as Purple Bricks, Yopa & Strike - they tend to provide sellers with a promise of lower fees, so you may find a gem on one of these sites. At this stage, if you are serious about buying your first home, it is beneficial to have an Agreement in Principle ready from a mortgage lender to show the mortgage amount the lender is willing to lend in principle and to confirm that you have passed their initial credit checks. This is something that we can arrange for you to provide to estate agents as and when required. This is not a mortgage offer, rather an agreement to lend as long as you meet all of their requirements and can evidence the information you have provided.
Making an offer
It's the home you have been searching for, and you are ready to make an offer. Make sure you have checked important elements with the estate agent such as but not limited to; any applicable ground rent or service charges (usually only leasehold properties have this but sometimes freehold do too), are there any restrictions on the property, is it standard construction, are there any immediate works or issues that they are aware of, are there any potential building developments in the local area. Find out the position of the sellers so that you can get an idea of any potential chain involved and what their timescales are. For example, if the sellers are moving into a new build, this can sometimes take longer depending on expected build completion dates. As a first time buyer, you are in a fantastic position as you are not tied to a chain, so it is important to know where the rest of the chain stands.
The sellers have accepted your offer, so now it is time to instruct your solicitors to act on your behalf for the purchase. The estate agent will send out a Memorandum of Sale which confirms the purchase price, as well as the seller's details and their solicitor details. The Mortgage Company can recommend and instruct solicitors on your behalf, this would be a third party referral to an independent specialist. We have access to a panel of solicitors who use an online portal called DigitalMove, so this is something you could get started on straight away.
Applying for your first mortgage
It's time for the all important mortgage application! This is where we really come in. We use an online Fact Find system to gather your personal information such as your income, outgoings, any loans or credit cards as well as credit history information. You can complete the Fact Find in the comfort of your own home it is something we ask you to complete whilst you are searching for a home, so we can move forward quickly once you have an offer accepted. We will require all of your documents such as payslips, accounts (if self employed), bank statements , proof of address and ID. We will carry out research with a comprehensive range of lenders once you have an offer accepted, and present you with the most appropriate option to suit your needs. We will provide you with a mortgage illustration which provides details of the mortgage product including the amount, the overall term, product type & term, monthly payments and any other applicable features. We will arrange a call to run through the illustration in detail & ensure you understand all elements of the recommended product. Once you have confirmed you are happy to proceed, we go ahead and apply to the mortgage lender on your behalf.
Valuation - mortgage & RICS surveys
Once the application has been submitted, the lender will instruct a qualified surveyor to visit the property for a property mortgage valuation. This is a valuation solely for their purposes to ensure that they find the property to be suitable security to lend on. This will not pick up remedial issues or works that need carrying out unless they feel that works are required to make the property suitable to lend on. Sometimes, lenders can hold what is known as a "retention" if they feel that work needs to be carried out before they will lend on it. This can be the case if they believe the roof needs urgent attention, or damp proofing needs to be completed, for example. Once the valuation has been carried out, a report will be sent to the lender to review. The mortgage valuation will also confirm that the valuer agrees the property is worth what you are intending to purchase it for.
If you would like peace of mind of any potential works that may need to be carried out or things to consider, you can pay for your own property survey which is carried out by a Royal Institution of Chartered Surveys (RICS) surveyor. There are a few different types of survey ranging from a basic level 1 Home survey to a more detailed level 3 survey.
All being well with the property valuation and underwriter assessment of your mortgage application, we would be looking toward the mortgage offer as the next step in the process. There can sometimes be back and forth between the broker and the lender to answer any queries; sometimes with further documents being requested by the lender. We like to ensure that we have everything that could be requested upfront, to ensure the process is as smooth as possible for you. Once the mortgage offer is in, this is sent to us, to you & to your solicitor, who will need to review the offer and action anything that the lender has written into the offer as a condition. The solicitor will be in touch with you if anything further is required.
Solicitor searches and enquiries
Your solicitor will carry out searches on the property which means contacting the Local Authority to check for any planning applications, highways issues, pollution and so on. They will carry out environmental searches, water and drainage searches and land registry searches, as well as anything else required specific to the property such as coal mining. Solicitors will usually ask for a payment for these upfront because they cost the solicitor to purchase them, so you will be covering these costs. Enquiries are communications back and forth between the seller's solicitor and your solicitor, and also satisfying those offer conditions we mentioned earlier. This part of the process can take some time because the solicitors are relying on responses from third parties. The solicitor will require you to sign the mortgage deed and post this back to them.
Exchange of contracts
Once searches and enquiries are completed and signed off by all, you should be in a place to be able to exchange contracts which means signing the paperwork to change ownership from the seller to you! It is common to send across an "exchange deposit" at this point to your solicitor, which will make up part or all of your deposit on the property. This shows the commitment from each side. It is at this stage that completion dates are usually also set, to ensure that everybody has time to arrange for removal vans, booking time off work, and arranging themselves for the move in date!
NB: Ensure that you have buildings insurance in place for exchange of contracts, because legally the property belongs to you from this date, so you need to make sure you are covered in case anything happens to the property between exchanging and completing.
A completion date will be agreed upon and set between your solicitors and the seller's solicitors. once the day arrives, all that is left is for you to collect the keys from the estate agents at a suitable time once the house has been vacated (if not already empty) and you can head to your new home! NB: As a mortgage is secured on your home, your home may be repossessed if you do not keep up repayments on your mortgage.
Please note this timeline of events is not exhaustive but rather gives an indication of the main stages to expect when purchasing a home