Step 1: Agree a mortgage
You might not have found your home yet but it doesn’t mean you can’t get your finances in order.
You can get a mortgage from an independent financial adviser, mortgage broker, bank or other lender. Always search the market for the best possible rates.
Once you’re happy, get an agreement in principle (AIP). Nowadays you can do this online. The AIP tells you:
- how much you’ll be able to borrow, based on your credit score
- the interest rate you’ll pay
The AIP is usually only valid for 30 or 90 days, so if it expires it’s worth doing another search to try to find a better deal.
Your conveyancing solicitor will recommend that you have finance in place before you exchange contracts, so it’s vital that you ensure your mortgage offer is valid.
Step 2: Find your new home
Research the market so you know how much similar houses in the same area are selling for. When you view a property with the estate agent:
- Be shrewd. Play down your interest—and your budget—even if you’re certain this property is your dream home.
- Ask why the owners are selling, and what they’re including in the sale (e.g. fixtures and fittings, other contents etc.). You might want to get this in writing.
- Find out everything that could impact you or the property once you’ve bought it, such as:
- planned works
- problems with neighbours
- issues affecting the local area
- Examine the property thoroughly, including:
- looking for damage that the owners might be trying to hide under furniture, rugs or new coats of paint
- checking water pressure, central heating and drainage
Once you’re satisfied, you can make your offer.
Step 3: Make an offer
You’ll make your offer to the estate agent. You won’t have to pay them anything—they only charge a fee for selling properties.
Homes are sold either via open negotiation or sealed bids.
Buyers submit offers and compete openly to have theirs accepted. There are opportunities to increase offers and ‘gazump’ other buyers.
Buyers submit their written offer in a sealed envelope. With no knowledge of competing bids, buyers usually start at the top end of their budget. The seller can then choose the highest offer, and often get more than their asking price.
When your offer is accepted
- Remember that, legally, nothing is set in stone until you exchange contracts, and either you or the seller can still pull out of the transaction.
- Ask the seller to take the property off the market. Otherwise, you’re at risk of being ‘gazumped’, which is when another buyer makes an offer higher than the one you’ve had accepted. The only defence to being gazumped is to do it yourself and increase your offer.
Step 4: Submit your mortgage application
Step 5: Instruct a conveyancing solicitor
Conveyancing is the legal term for transferring ownership of property. You need to appoint a conveyancing solicitor to do all the legal work required to make sure your house purchase goes smoothly. This includes:
- preparing documents—including requesting a draft contract from the seller
- conducting conveyancing searches
- providing any necessary legal advice—for example:
- examining conditions of the sale
- explaining issues such as planning conditions
- paying stamp duty on your behalf and registering you as the new owner
- contracts and completion—for example:
Some mortgage lenders insist that you choose a conveyancing solicitor from their own panel, so always ask whether this applies to you. Graysons Solicitors is on most lenders’ panels.
Step 6: Arrange a survey
Although your lender will have a valuation survey carried out (see step 4), this is very basic and won’t include anything about the condition of the home you’re buying.
Surveys carried out by qualified surveyors are optional but highly recommended. They are detailed inspections that will reveal problems you wouldn’t otherwise discover until after you move in. Read more about surveys here.
As the buyer, you must arrange the survey yourself—your solicitor has no involvement in this part of the process.
Step 7: Pay the deposit
As you move closer to exchanging contracts, your solicitor will ask you to:
- sign the contract
- pay the deposit
The deposit is usually 10% of the total purchase price, and your solicitor will transfer the funds to the seller’s solicitor.
Step 8: Agree a completion date
Before contracts can be exchanged, everyone involved must agree a date for the purchase to complete. This is usually between 6 and 12 weeks from the start of the process, but it does depend on how complicated the transaction has been.
It’s also common to have a week between exchange and completion to allow your solicitor sufficient time to carry out the final searches and obtain your mortgage funds, but this period can be longer or shorter to suit the circumstances of the chain.
Avoid agreeing a completion date with the seller or any other parties before your solicitor advises you to do so, as issues can crop up which then delay the date and leave you disappointed.
Step 9: Exchange contracts
Your solicitor and the seller’s solicitor will exchange signed copies of the contract, meaning you’re now legally committed to the purchase. Neither you nor the seller can pull out now—if you did, you would lose your deposit and potentially be liable for other damages.
You shouldn’t exchange contracts until you’re satisfied that everything found in the surveyor’s report has been properly dealt with.
At this point, your solicitor will also:
- request funds from your lender
- deal with the final searches
- ask you to forward any amount of the balance that you’re paying yourself (i.e. not borrowing)
This is also a good time to arrange buildings insurance.
Step 10: Completion
On the working day before the agreed completion date, the money for the purchase will be transferred electronically from your mortgage provider to your solicitor, who will send it on to the seller’s solicitor. Once this goes through, the transaction is complete and you can collect the keys for your new house.
Your solicitor will:
- register your ownership with the Land Registry
- pay the stamp duty land tax on your behalf
Registering your ownership can take some months depending on how busy the Land Registry is. Once your solicitor receives the paperwork, they will send both you and your mortgage lender a copy.
Thank you very much Niki for your hard work to get this completed on time! Before we entered the house buying process it seemed that nobody had anything nice to say about solicitors so we feel really lucky to have found someone who is a great correspondent, efficient, and who we really feel has fought our corner! We look forward to recommending you in future.
Laurie & Luiza from Sheffield
A big thank you to Niki Middleton for all her hard work in ensuring my purchase of a property completed successfully. She was very professional, enabled the tight deadline forced on us by the vendor to be met and was a pleasure to deal with. I will have no hesitation in recommending her to family and friends.
Joan from Sheffield