Buying a home
The House Buying Process
It’s incredibly exciting to start the house buying process but it can certainly feel overwhelming! Especially for first-time buyers. We know that it can get stressful so our goal is to make your mortgage experience as stress-free as possible, and no matter what your financial situation, we endeavor to find the right mortgage for your circumstance.
When purchasing a house for the first time, many ask what order they should be doing things - do you start looking at houses first? Do you first speak with a free mortgage advisor when buying a new home? Or do you talk to the banks before anything else? To help with these questions, we’ve listed out the different components that make up the house buying process in this comprehensive guide.
There are many elements to take into consideration such as solicitors, surveys, the actual mortgage application and any insurance that may be required! As some of these come at a cost, you must get the process right so you minimise financial loss if the property purchase happens to fall through.
Take a look through our simple guide to the house buying process below, and please do get in touch if you wish to discuss your upcoming property purchase.
Step 1: Let’s talk money
It’s so important to talk with a mortgage broker at the VERY start of your house buying process. Discuss your needs with a free mortgage advisor when buying a new home as they will be able to determine your borrowing potential.
Once you know this, we recommend you get a ‘decision in principle’ as this will backup your broker’s affordability calculation (what you can afford to borrow) and it will also involve a credit check*. This ‘decision in principle’ document will basically let the seller know that you can follow through with your offer and that you have a lender who is willing to give you the money to purchase the house.
Bear in mind that a ‘decision in principle’ lasts 3-months so you must start the mortgage application process within this window. If you go past this 3-month window, you will need to get another ‘decision in principle’ issued - this won’t cost you any money at TW Mortgages and we can easily get this processed for you.
Now you know how much you can afford and you’re now armed with your ‘decision in principle’, you're ready to start house hunting!
*If you are concerned about your credit score, obtain a copy of your credit report and speak with us about your financial situation.
Step 2: Start the house hunt!
It can be a lot of fun seeing all the different types of properties out there and discovering what kind of house will make the right home for you. Begin your hunt by searching the market for properties in the ballpark figure of what you can afford.
You can use estate agent maps, such as Rightmove, to get a good idea of what you can get with what you can afford… and where!
You will likely be dealing with estate agents at this point - you’ll need to book in viewings and make an offer on the property that captures you. But don’t forget, many other people may be viewing the property at the same time which is a great reason to have your ‘decision in principle’ to hand at this point.
This document will improve your chances of being chosen by the estate agent to buy the property as you have the evidence that you’re ready to proceed, unlike someone who views a house without the documents proving they can afford to buy.
When you find a property you love, put in a formal offer with the estate agent and wait for news of their acceptance of the offer. Be prepared to give a counter offer if the house has received a lot of attention and offers - you may need to go above the asking price in particularly desirable locations.
Step 3: Apply for a mortgage
Once you’ve had an offer accepted by the estate agent, it’s all systems GO!
You can now begin the process of submitting a full mortgage application. We will establish your mortgage needs and provide a quote - all for free - and once you’re happy with the quote, we will need a list of documents to support your mortgage application. The list will include ID, proof of address, proof of income and proof of deposit (more documents may be required).
You will need a solicitor before you apply for a mortgage, but we advise you not to pay them any money until your mortgage application has been submitted.
We’ll be able to complete your mortgage application at which point the quoted product will be reserved and that rate should now be protected. Providing everything goes smoothly, you should see your mortgage offer come through around four weeks after the application but do note that lenders' processing times vary greatly.
Step 4: Survey the property
The lender will request a basic valuation of the property to determine the value, however, this valuation won’t go into detail about the structural soundness of the property. Many opt to get a homebuyers report or a full structural survey carried out.
We highly recommend that you have the structural soundness evaluated, if you can afford to do so, as it will mean you’ll know of ANY issues both inside and out. If something gets uncovered which would be very expensive to repair, you may be able to use it to negotiate the house price… but if not, at least you’re fully in the know about the property’s structure. If you uncover any expensive structural issues and the house price can’t be negotiated, you can always pull out of the offer. You won’t be able to claim back any money spent on your survey but it’s worth noting that nothing legally binds you to the property until the contracts are exchanged at the end of the house buying process.
Homebuyers Report:
This will involve a detailed visual inspection of your property or the property you want to buy. They will then issue a report which has a simple grading system of the various aspects of your property - it’s often presented in a traffic light system so you can clearly see any (red) areas of concern.
A full structural survey or building survey:
A full structural survey or building survey is the most comprehensive of all the surveys! It will include the details from the home buyers report, as well as a more in-depth analysis of the property's condition. It will give you detailed advice on defects repairs and maintenance options which can be very helpful.
Please note: Although a survey can be really helpful in ensuring your property is structurally sound… if the purchase falls through for any reason, the money you spent on a survey will be lost. It can feel risky but if you can afford a survey, we recommend you do one for peace of mind.
We also recommend leaving the survey until you have your mortgage offer so you don’t lose money spent on the survey if your mortgage falls through.
Step 5: The final countdown - Exchange and Complete!
Hurrah! You’re at the final steps of the house buying process! This last section will see you mainly working with your solicitor as they establish exactly what is being purchased and in what condition.
You will receive a list of all the items in the property; from curtains and dishwashers to doorknobs and shelving. The seller will detail what will be left behind in the property and what will be taken with the seller. Read this information carefully in case things are taken or left which you’d prefer weren't - you can dispute any of these items.
The solicitor will also send you a copy of the contract which will eventually secure your ownership of the property. Signing the contract does not legally bind you to the purchase - you’re not legally binded to the property until the contracts are exchanged.
Once you’re at this stage, your solicitor will ask you for separate consent to exchange the contracts.
Once the contracts are exchanged and you have become the legal owner of the property then the last remaining stage is to complete!
Completion means that the mortgage funds are sent to the seller via the solicitor and you can pick up the keys to the house, normally from the estate agent, and move in. Congrats - enjoy your lovely new home!
Here at TW Mortgages, we are a well-trusted mortgage broker who gives free mortgage advice to those buying a new home. We will be with you every step of the house buying process and will ensure your mortgage experience is as efficient and stress-free as possible. Get in touch today!