Catch a falling star save it for a rainy day

Catch a falling star and put it in your pocket save it for a rainy day! When it comes to buying that all important home many of us underestimate the full cost of buying a home and so catch and save everything you can as it will almost certainly be needed.

House buying it’s not a one egg omelette

Although many of us have an understanding of having to pay a solicitor when we buy our home, many of us forget all the additional costs that soon mount up if you have not accounted for them.

So let’s start at the very beginning a very good place to start, the deposit. This is by far the biggest cost and many mortgage lenders want at least 10% of the purchase price up front. The more you put down the better the interest rate you are likely to be offered.  If you don’t manage to find the 10% but still get a mortgage at a more expensive rate the lenders may also impose that you get mortgage indemnity insurance.

The Legal Bit!

When you have found your property and have a provisional offer you need the services of a solicitor or licensed conveyance to begin the legal process of buying your home. This cost can vary depending of the work needed to be done and the property value.

Stamp Duty Land Tax (SDLT)

In the UK when there is a transfer of property or land and where the amount paid is above a certain threshold H M Revenue and Customs require you to pay a fee before completion of the transfer of ownership can take place.

The Survey 

If you are going for a mortgage your lender will ask you to pay for a mortgage valuation report to confirm that the property is worth the amount you have asked to borrow.

For an additional cost you may choose to have a homebuyers report or full structural survey. This cost can range from around £300 to £1000.

Mortgage Arrangement Fees

To process your mortgage application mortgage companies charge a fee which can be around £500 or more.

Cover the things you care for

Building and contents insurance is a must and many mortgage lenders will insist on the buildings insurance as part of any offer.

Mortgage Protection Insurance

If you cannot work due to illness or you lose your job this insurance will meet your monthly repayment until such time you find work or return to work.

CHAPS Fee

Some lenders charge about £30 to cover CHAPS (Clearing House Automated Payment System) to arrange the telegraphic transfer of funds to your solicitor to complete your property purchase.

Search Fees

Your solicitor may recommend about 5 searches which can cost around £300.

A Sure Catch

Make sure you catch the biggest star of them all and keep it safe in your pocket because remember through all this process you will be in the star hands of David Jordan Estate Agents an estate agent that excels in all areas of the house buying process and will take you every step of the way. 

The time is now David Jones Estate Agents is here to make sure you have a pocket full of starlight whether buying, selling or letting.

 

Call or email us using the details on our website  www.davidjordan.co.uk

T:    01323 898414

Simply The Best

We think that we David Jordan Estate Agents are the best. We speak your language, we are there when you need us and we know what it means to look for your dream home. We offer some tips about getting that all important mortgage.

Know your onions

Getting a mortgage can be a tricky affair and for first time buyers daunting to say the least. It’s important to select the right lender and get the best possible rate so you don’t pay a higher rate than necessary.

So for some buyers waiting and saving a bigger deposit can in the long run save thousands of pounds on their annual mortgage.

Getting to know how a mortgage works, the process involved and what lenders need from you. This can help you to secure a better interest rate and increases the chances of getting accepted for a decent sized loan.  The big problem with banks today is that they continually change their lending criteria leaving you chasing your tail.

What you need in your shopping basket

To get a mortgage you will need a:

• clear credit history;
• solid deposit; and
• suitable home.

Support of parents for many can be the difference needed to get a mortgage.

Big is better

The size of your deposit will determine what your monthly mortgage payment is and the interest rate that you pay.  In the main all lenders use a loan to value banding system meaning you pay considerably more if you only have a small deposit.

A further 5% on top of what you have saved if you can because will give you big saving when trying to secure a mortgage. For example if you have a 10% deposit, you may for example get a rate of 5.75%. With another 5% deposit this could drop to say 4.29%. The point being that the extra deposit will make a difference to the mortgage rate you can secure.

Be Prepared

Before any mortgage offer is forthcoming any lender will need to know what your monthly outgoings are and how much you have left at the end of the month.  Lenders will take into account any existing borrowing you have and this will include credit card and store cards.

Because of past history with interest only mortgages if you are trying to secure this type of mortgage you will be faced with needing a possible 25% deposit. Some lenders will require you to earn a minimum of £30,000 to qualify. 

This is because while interest only mortgages offer a more affordable way to get on the property ladder and the monthly payments are considerable less because you only pay the interest on the money you borrow. The onus however is on you to ensure that at the end of your mortgage term you have all the capital you borrowed to repay back to your lender.

Red hot chilli pepper tips to help you get a mortgage.

• Make sure you are on the electoral roll.
• Don’t miss any monthly loan payments including credit cards as this can count against you.
• Try and reduce any personal debt this means you can borrow more.
• Don’t apply for more credit while your mortgage application is going through.
• Check and know your own credit rating.
• Have available your payslips and P60’s.
• And as with anything financial, do your homework, know what lenders want from you.

And don’t forget throughout this journey David Jordan Estate Agents will be with you every step of the way offering their years of expertise to guide you along the way.

Call or email us using the details on our website  www.davidjordan.co.uk

T: 01323 898414