Welcome back to my mini-series on the first time home buying process! In my previous article, I covered the crucial aspects of budget planning and mortgage affordability. Now that you have a solid understanding of your financial position, it’s time to get into the nitty-gritty of the home buying process itself.
This comprehensive guide will walk you through each step of the home buying process, from getting a mortgage in principle to finally receiving the keys to your new home. Whether you’re just starting your property search or you’re ready to make an offer, this article will provide you with the knowledge and confidence to navigate this exciting journey.
1. Get a Mortgage in Principle
The first step in the home buying process is often getting a mortgage in principle (also known as an agreement in principle). This can give you a clearer idea of what you can borrow and shows estate agents and sellers that you’re a serious buyer. Some lenders will require you to have a specific property upon which to create a mortgage in principle, so you may need to complete the next step of the home buying process first.
2. Start Your Property Search
With your budget in mind, begin looking for properties that meet your needs. This stage of the home buying process involves considering factors like location, property type, and potential for future improvement. Nowadays property websites such as Rightmove and Zoopla make house-hunting super easy, especially as many properties have virtual tours – although I would never recommend buying a property without having actually visited it yourself first.
Viewings are often conducted by an estate agent but on occasion it may be the homeowner who takes you round. Make sure you ask as many questions as you can – this may be your future home so don’t be afraid to ask anything that comes to mind.
3. Make an Offer
Once you’ve found a property you love, it’s time to make an offer – a crucial step in the home buying process. As a first time home buyer, you’re in a strong position as you’re not part of a ‘chain’, which is a series of linked property sales and purchases where each transaction is dependent on the next. This means that buyers and sellers must coordinate their move dates, new mortgages and other transactions simultaneously, so the longer the chain the more complicated this becomes. A first time home buyer is always an appealing prospect for a seller (or ‘vendor’) as you have no-one beneath you in the chain to cause problems or delay the transaction.
4. Hire a Conveyancer
A conveyancer or solicitor will handle the legal aspects of the home buying process. They’ll conduct searches, draft contracts and manage the transfer of funds. Your estate agent or mortgage advisor may recommend a conveyancer and you are of course free to go with them if you wish. However, I suggest speaking to friends and family to see if they can give you any recommendations as word of mouth can be very useful here. An efficient and knowledgeable conveyancer is worth their weight in gold so if you can get a personal recommendation for someone it could make all the difference.
In the past it was necessary to have a local conveyancer as throughout the home buying process you would need to deliver signed documents to them. Nowadays, conveyancing can be done completely online – I myself have used Premier Property Lawyers and their online portal was an invaluable tool that allowed me to access my case 24/7 and submit all paperwork and documentation online, so no inconvenient office hour restrictions or the hassle of having to go to the solicitor’s office in person to drop off signed papers.
5. Get a Survey
While not usually a mandatory part of the home buying process, a survey can reveal any issues with the property before you commit to buying. For first time home buyers, this can provide peace of mind and potentially save money in the long run.
There are three main types of survey available:
- Condition survey – This is a Level 1 survey that’s suitable for conventional houses, flats or bungalows that are in reasonable condition.
- Homebuyer survey – This is a Level 2 survey that’s suitable for most properties.
- Building survey – This is a Level 3 survey that’s more in-depth and is suitable for properties that are older, have had major renovations or are made of unusual materials.
Your estate agent and/or conveyancer should be able to advise what type of survey would typically be needed for the property you are buying. In addition, sometimes the mortgage company will stipulate that you must have a certain level of survey.
When you receive the survey, if there is anything that you are unhappy about you can discuss this with the vendor via your conveyancer. They will contact the vendor’s conveyancer to try to reach an agreement – for example, if the survey shows that the brickwork needs repointing the vendor may agree to get the work done at their cost as part of the purchase agreement, or they may instead agree to reduce the purchase price so that you can then pay for the works to be completed once you own the property.
If both parties are unable to reach an agreement, or if the survey brings up significant aspects of concern, you can pull out of the purchase. This is of course never done lightly as by this point you will have already incurred some costs (depending on your circumstances it will likely be no more than £1,000) but remember it is better to withdraw from the deal at this point if you are uncertain than to continue and end up with a property that you are unhappy with and/or will cost you much more in the long run (I speak from experience!).
6. Exchange Contracts and Complete
Once all checks are done and you’re happy to proceed, you’ll exchange contracts with the seller. This is the point in the home buying process at which the purchase becomes legally binding. This can happen as quickly as 28 days from the date your offer was accepted, but it more commonly takes place 2-3 months later.
Completion is when you’ll get the keys to your new home! This can happen some time after exchanging contracts, perhaps within a few weeks, but in my own experiences exchange and completion have always taken place either on the same day or within a day or two of each other.
If you have a specific timeframe or deadline that you need to meet make sure you make all parties aware of this from the very outset so that they can do their best to work towards it, but do keep in mind that house buying is very much a moveable feast and timelines and timeframes are frequently subject to change.
Congratulations! You’ve now got a clear roadmap of the home buying process. Remember, while this guide provides a solid overview, every property purchase is unique. Don’t hesitate to seek advice from professionals like mortgage advisors, estate agents and conveyancers along the way. They can provide invaluable insights tailored to your specific situation and help keep the home buying process on track.
In the third and final instalment of this mini-series, I will discuss what happens after you’ve completed your purchase, including essential tips for moving in and settling into your new home. Stay tuned, and happy house hunting!