Your First Home
A Buyer’s Guide
Hello...
As experienced mortgage advisors, we understand that buying your first home can be a stressful and sometimes confusing process. So, we have prepared this guide to help simplify the process.
We hope that you will find this information useful, but don’t forget that we are only a phone call away should you wish to speak to us directly.
You can contact us on our
Freephone 0800 378 669 , and you can find further useful information on our website
www.teachersbs.co.uk
We hope to speak to you soon!
The TBS Mortgage Team
Questions to ask yourself
Before getting too involved in the house buying process, it makes sense to ask yourself a number of questions regarding your finances.
You need to make sure that you have the funds available to pay for all of the costs associated with a house purchase.
You may already be renting, in which case you’ll be used to paying monthly housing costs. However, it is still worth taking a few moments to consider the following:
Deposit
Do you have any funds available to be used as a deposit towards the purchase? If not, you may wish to find out about affordable housing schemes provided by the Homes and Communities agency.
Visit www.homesandcommunities.co.uk for more information.
Mortgage
How much can you afford to borrow? You can find this out by speaking to our mortgage team. Alternatively, if you just want a ballpark figure, you can use the mortgage calculator on our website.
Visit www.teachersbs.co.uk Mortgage Fees
There are various fees that may be payable in respect of arranging a mortgage. Speak to your mortgage advisor to confirm any that will be payable by you. These will also be detailed in your Key Facts Illustrations.
Stamp Duty Land Tax (SDLT)
This is a tax on the purchase price of land and buildings.
When you buy a property or take on a lease, you may have to pay SDLT.
Visit www.hmrc.gov.uk for more information.
Property Valuation
We’ll want to instruct our own basic valuation to assess the value of your proposed new home and whether it is suitable security for a mortgage. However, there are more detailed reports available which will provide you with more information about the general condition of the property.
Details of the costs involved can be provided by your mortgage advisor.
Total Monthly Outgoings
Even if you are currently renting, be aware that the costs may differ when you own your own home. For example, consider the cost of council tax, insurances, household bills and mortgage payments. The budget planner at the end of this guide can help you work out these costs.
Insurance Products
All mortgage lenders will insist on a buildings insurance policy. However, it is certainly worth considering contents insurance and perhaps other mortgage protection policies. Again, your mortgage advisor can assist you with these matters.
Solicitors/Conveyancing Fees and Disbursements
You will need a solicitor and/or conveyancer to handle the legal work involved in a house purchase. It is worth getting hold of a few quotations so you know the sort of cost you will be looking at. We can provide you with a quote through our partner, Flint Bishop. Just ask your advisor for details.
Removal Firm
Depending on the amount you have to move, you might want to consider using a removal firm. Most removal firms will be happy to give you an idea of the costs involved beforehand.
Decorating and Furnishing
Consider whether you will need to decorate or buy any furniture. It’s a good idea to cost this up beforehand so you know how much you can spend.
Consider what you want to
buy
Location
Number of bedrooms
Distance to work
Local schools for children
Access to shops and local amenities
Access to public transport
Do you need a parking space?
Do you need a garden?
When you are looking for your new home, it is worth spending a little bit of time considering what your priorities are. This will help you to narrow down your options and be more specific in your search.
You may be able to get everything you want from just one property, but you may find that you need to make a few compromises. So, decide what is a ‘must have’ and what is a ‘nice to have’. Here is a list of some of the
common factors worth considering:
What do you do next?
By now, you should have worked out your finances, found out how much you can borrow, searched the area for suitable properties and found a property you wish to buy.
The next step is to put in an offer on the property. If you are using an estate agent, you must advise them of how much you are willing to pay for the property so that they can contact the vendor on your behalf.
Remember, although the asking price for the property is what the vendor hopes to sell it for, they may consider accepting a lower offer for a quick sale or if the property has been on the market for a significant period of time.
If you are not successful with your first offer, there is nothing stopping you putting in a higher bid if it is financially viable and you feel that the property is worth it.
Starting the property search
Once you have decided on the type of property you wish to buy, you can begin your search.
The most obvious place to start is by visiting estate agents to discuss the types of properties available in the area of your choice.
If you’d prefer to begin your search online, websites such as Rightmove and Zoopla have become popular tools for buyers, and most estate agents have their own websites with full property listings.
Auctions have also become popular, but you must be careful when buying at auction; once your bid is accepted, you will have to pay a non-refundable deposit immediately and it is usual for a deadline to be put in place for completion.
Therefore, if you are considering buying at auction, it would be wise to contact your lender as soon as possible.
The mortgage application
Once your offer has been accepted, you will need to contact us to confirm that you are ready to proceed with a mortgage application.
We offer a fully advised service and will make arrangements for you to speak to one of our fully qualified mortgage advisors. Your advisor will be your point of contact throughout the mortgage application process and will send you everything that you need to complete your application, including a Key Facts illustration detailing the product your advisor has recommended to you.
This will provide you with full details of the mortgage product, including monthly payments and any fees payable, and will be sent to you together with an application form. This form will need to be completed and returned with documentation such as recent pay slips and bank statements. Your application will then be underwritten by the Society’s in-house underwriters to ensure that we are able to lend you the full mortgage amount.
At this time, you should also contact your solicitor/conveyancer to advise them that you have found a property and that your proposed lender will be in contact with them shortly.
Once we have established that we are happy to accept your application, we will then proceed with instructing a property valuation.
The property valuation
A mortgage lender will require a basic property valuation to be carried out.
The purpose of this is to ensure that your potential new home will provide enough security for the mortgage. We will instruct this on your behalf.
The cost of the valuation depends on the purchase price of the property and our mortgage team can provide you with this cost.
It’s important to bear in mind that this valuation is for the lender’s use and you may decide to opt for a more detailed survey, allowing you to ascertain the condition of the property.
In brief, there are two types of more detailed surveys: a Homebuyer’s Report and a Building Survey, details of which can be found on the following page.
Continued...
Homebuyer’s Report
This is a survey which is set out in easy to understand sections covering the information, condition and value of the property.
It will indicate the extent of the inspection carried out and will highlight anything that could not be inspected as well as anything that you should check with your solicitor/conveyancer.
If you require this type of report, just let us know. The homebuyer’s report includes a basic valuation as standard.
Building Survey
This is a report providing detailed advice on the property. Again, it is divided into sections covering the information, condition and value of the property, but will be more in depth with a higher level of inspection.
This type of report is usually only found to be required for properties over 100 years old, or where you are concerned about aspects of the structure. If you require this type of report, you will need to instruct your own surveyor.
Keep in mind that the lender will still need to carry out a basic valuation and the cost of both reports will be your responsibility.
Further details regarding the types of valuation available can be found by visiting www.rics.org (Royal Institute of Chartered Surveyors).
The final stages...
Once we are in receipt of the valuation, we will assess whether the property is suitable security for mortgage purposes. If it is, we will then prepare a formal mortgage offer. This will be sent to you and a copy will also be sent to your solicitor/conveyancer.
By this stage in the process, it is likely that one of our mortgage advisors will have contacted you to discuss your buildings insurance arrangements.
We can also assist with arranging contents, personal possessions and family legal protection insurance as well as mortgage protection policies if you choose.
Suitable buildings insurance must be arranged before the Society is able to release the mortgage funds. Once your solicitor/conveyancer has completed their legal obligations, they will arrange for contracts to be signed and exchanged between the vendor and yourself, the buyer.
At this stage, the sale and purchase becomes legally binding, so you should make sure that you fully understand and are happy with all aspects of the purchase before the exchange takes place. Large costs can be involved if either party pulls out after this time.
Once contracts have been exchanged, a completion date will be set. Your solicitor will contact the Society to advise them of this date so that we know when to release the mortgage advance monies.
Completion day!
On or shortly before completion day, the Society will release the mortgage advance monies to your solicitor.
Your solicitor will then arrange for the funds to be forwarded to the vendor and, once received, completion will be official - you are now a home owner!
You can collect the keys and move into your new home as soon as you’re ready.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
Budget planner
Household income
Gross Annual Income £...
Net Monthly Income £...
Monthly Child Benefit (only if child is under 13) £...
Monthly Maintenance (only if child is under 13) £...
Financial Commitments
Credit Card & Store Card(s) £...
(calculate at 3% of outstanding balance)
Unsecured Loans/Hire Purchase £...
Child Support Agency (CSA)/Maintenance £...
Shared Ownership/ Help to Buy Interest Payment £...
Cost of Interest-Only Repayment Vehicle £...
Household Expenditure
(please convert annual cost to monthly payment) Property & Utilities
Gas/Electric £...
Water/Sewerage £...
Council Tax £...
Buildings & Contents Insurance £...
Ground Rent/Service Charge £...
Phone/TV/Internet £...
Food £...
Travel
Petrol £...
Train/Bus Fares £...
Car Insurance/Tax £...
Personal Expenditure
Childcare £...
Other Insurance Policies (Life, Healthcare etc.) £...
Clothing/Social £...
Household Repairs £...
Please note: this planner is for your personal use only
Tel: 0800 378 669 Fax: 01202 841 694
Email: teachers@teachersbs.co.uk Website: teachersbs.co.uk
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Unlike many lenders, we do not use an automated
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Teachers Building Society, Allenview House, Hanham Road, Wimborne, Dorset BH21 1AG Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and
the Prudential Regulation Authority (Register no. 156580).
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