Last Updated on February 22, 2023 by Kravelv
If you’re not sure how buying a house works, you’re in the right place. We’ve got everything you need to know, right here.
Buying a house can be stressful, especially if you don’t know how it works. The process of buying a house isn’t something that everyone knows, they certainly don’t teach it at school! (oh sure, fractions are essential but learning about houses and mortgages aren’t?) So, what to do when you’re about the buy your first house and have no clue what to do. Are you looking to buy your first home? Not quite sure how the process works? Luckily for you, you’re in the right place.
Yes, we’ve spoken to leading estate agents about the process of buying a house. We’ve got all the essential information you need to know, so you can go in confidently to your estate agents, and not be thrown off! In this step by step guide, we’re going to look into the process of buying a house – so you know exactly what to expect.
Also Read: 20 Tips for first time home buyers
Step 1: Finding the One
The first step in buying a home is finding the right one for you. Whilst it may seem silly to find a home first, you need to gauge an idea of what you’re looking for in your first home. It will give you a sense of what sort of budget you’ll need. Are you looking to live alone? Perhaps you’re buying with a friend or partner. Whatever the case, scouting out the right home will help give you a sense of what you’re getting yourself in for. You need to find the right house, in the right area, and look at the price of the property – so you can set yourself a budget before you buy. Local estate agents will be able to assist you in finding a house in the area, or you can use the online ones for a countrywide search. It’s dependent on where you want to live, and that will give you an idea of what sort of budget you need. Once you’ve seen a few homes, and decided on the area, you’re ready for step 2…
Step 2: Mortgage Quotes
Once you’ve decided on your budget, you need to see how much you can borrow. Yes, you’ll need to shop around to see what rates you can get on a mortgage, with the deposit you have, and you could make use of a resource like this Mortgage Calculator to help you work out what your monthly payments might look like with a certain mortgage. Typically, you need around 5-10% of the house’s price as a deposit on a mortgage, so knowing your budget is key. But, don’t apply for the mortgage until you have found your home! Most lenders will need to see evidence of a house sale before giving you the mortgage – although you can find out what to borrow so you can determine your buying budget.
Step 3: Finding the Dream House & Putting Down an Offer
Once you’ve got a clear sense of area, house size and budget, you can start seriously searching for your new home. Looking around for your dream home is no easy task, but once you find the one you want, you need to move fast. It needs to be within your budget, and within the range of your quoted mortgage. Then, you can put down an offer on the house. Usually, you’ll need a cash sum of around £500 – £1000, dependent on the price of the house, as a holding fee for the estate agents. This ensures that you’re serious about buying and won’t pull out of the sale. If you do, you’ll lose the deposit, but if the sale falls through, through no fault of your own, your deposit is returned. Once you’ve put your deposit down and your offer has been accepted, it’s time for step 4…
Step 4: Getting your Mortgage
Mortgage Quote? Check. Dream Home? Check. Offer put down? Check! So, what now? Well, now’s the time to take up your mortgage provider on their offer and take out your mortgage ready for the house’s sale. Once you’ve got an accepted offer, you’ll know exactly how much you’ll need to borrow from the mortgage providers. And you’ll be one step closer to your dream home!
Step 5: Legal Stuff
Once you’ve found your house, got your mortgage and put your offer down – now’s the time for all the boring legal stuff. This is where you’ll need a surveyor, conveyancer or solicitor, to carry out contract exchange, property checks and more – to ensure that the house is up to scratch and fit for purchase. Some mortgage companies send their own surveyor round, as the mortgage they offer you is being used to purchase the property. Therefore, it needs to be up to their standards and fit for the price you’re paying. Once all this is done, you’ll be ready to move into your new home.
Also Read: Things to Consider before buying a property
Step 6: Finishing Touches
After all we’ve listed above, there are a few minor things that happen before the end of completion. You’ll discuss things like what’s included in the house sale, when you can move in etc. All the rest of the stuff. Remember, you’ll need to pay your agency fees at the end of it all, but you’ll finally have your dream home! Ready to move in to.