First Time Buyers

We all need help especially if you’re taking your first steps on the property ladder, now is the time when you should be seeking professional advice.

We will conduct a thorough fact-find with you, this gives us lots of personal information and allows us to discuss your mortgage and protection needs and demands in depth with you.

It’s important to think about the financial impact buying your first home can have on your everyday finances. You need to consider other cost such as utility bills, council tax, insurances, and ongoing property maintenance.

If your circumstances change or interest rates increase, you need to consider if you could still meet your household commitments. We will explore and have discussions with you to set a realistic budget.

There are a number of things to consider:

Do you want to be in an area with a vibrant nightlife or a more rural, laid-back lifestyle?

Does the area you’re looking at have local amenities in walking distance?

How long will it take to get to work?

Is there a good transport infrastructure in place?

How close do you want to be to your parents, family, and friends?

Are there activity groups in this area which you want to be part of?

Check out the schools and council tax rates.

Ensure you spend a good amount of time viewing any property, 20 to 30 minutes at least so you can really get a feel for the place, after all it’s probably the most expensive item you may ever buy.

The seller doesn’t have to tell you about problems, a good tip is to open and close doors and windows and look for signs if any double glazing has moisture or misting.

Look in kitchen cupboard and wardrobes. Damp may not be visible yet, however, it has a distinctive odour, so be on your guard for unusual smells.

Other common faults in properties include water marks in ceilings below bathrooms, cracks in the plaster or uneven floors, ageing or un-serviced boilers and old electrical fuse boxes and wiring.

Walk around the outside of the house to check the exterior. Look for missing or loose tiles on the roof and broken guttering. Look at boundary walls and fencing and ask if any invasive plants are in the area such as Japanese knotweed.

If you find signs of a problem, ask questions.  

We’d recommend viewing the property two to three times, at different times of day, to find out how the light, traffic and surrounding noises change. You might just discover that the quiet, idyllic street you saw at 11am is a busy main commuter route at 6pm.

Spend at least half an hour walking around the general area to see how close the things that matter to you, such as cafes, schools, transport links or local shops.

Once you’ve found the place you want, you’ll need to make a formal offer, usually this will be done through an estate agent.

Estate agents continually ask for agreement in principles from prospective buyers, you can make a formal offer without already having an agreement in principle in place.

Estate agents are often very keen to get you to use their in-house mortgage services, they may have sales targets to introduce a minimum number of customers to their recommended adviser. Your offer to purchase should not be dependent on you using this service.

The Code of Practice for Residential Estate Agents section 9c states;

“By law you cannot make it a condition of passing on offers to the seller that the person wanting to buy the property must use services offered by you or another party. You must not discriminate, or threaten to discriminate, against a prospective buyer of the seller’s property because that person declines to accept that you will (directly or indirectly) provide related services to them”.

Discrimination includes but is not limited to the following:

• Failing to tell the seller of an offer to buy the property.
• Telling the seller of an offer less quickly than other offers you have received.
• Misrepresenting the nature of the offer or that of rival offers.
• Giving details of properties for sale first to those who have indicated they are prepared to let you provide services to them.

Remember the estate agents are acting on behalf of the person selling the property not you.

Congratulations, its time to get the all the information ready to be in a position to contact mortgage lenders.

We have many years experience dealing with first time buyers, so if you need any clarification of the next steps, let us know.

During our initial meetings we will have discussed the different types of mortgage products. We will search the mortgage market based on your needs, and provide you details of a suitable mortgage.

We strongly recommend you don’t apply for an agreement in principle (AIP) before you have had a formal offer to buy a property accepted by the vendor due to the following reasons;

• A mortgage lender who had a suitable mortgage for your individual needs a day, a week, or a month ago now may not have the most suitable mortgage for you today.
• Mortgage products can change on a daily basis. This would mean running another AIP with another mortgage lender who would again credit score you. Personal data should not be easily given to numerous lenders to satisfy an estate agents company procedure.
• Lenders will strike off a broker from their approved panel if a broker continually puts in AIP’s through them and they don’t progress to full mortgage applications.

Parkview Mortgages are happy to confirm to estate agents you have been financially assessed and are able to proceed with the property purchase.

Once your offer has been accepted, this is the point to apply for the AIP.

Once you’ve found the right home and started making plans for a mortgage, you’ll need to get help to process the legal side of things.

You don’t have to use a solicitor recommended by the estate agents. The estate agents may receive a fee for recommending a conveyancer, ask what fee they may be paid, ultimately you will probably be paying this fee in your solicitors’ fees.

It’s hardly the most exciting part of buying a house, but choosing a solicitor or conveyancer is a really important decision.

All solicitors are qualified to do conveyancing, but not all will have experience in this area, so use a legal firm that specializes in property transactions.

Don’t make your decision purely based on price. The firm you pick will be responsible for all of the legal work surrounding your property purchase, and if they miss anything or make a mistake, it could end up costing you a lot more than the amount you saved by choosing the cheapest service.

Ask to speak to the person who will actually be conducting your legal work, you want feel confident you’re instructing someone who will provide a professional service.

We strongly recommend you don’t pay for any searches until we can confirm your mortgage has been formally offered.

Discuss your preferred exchange and completion dates and ask if they can meet these.

The once the agreement in principle (AIP) has been approved, Parkview Mortgages will submit the mortgage application with required documentation to the mortgage lender.

The lender now starts to process your mortgage application based on the information provided. While this is often an automated process in modern banks and building societies, borderline, high loan to value lending, or more complex cases may be referred to an assessor for a manual review.

At this stage of the process, you may be required to pay any administration, arrangement, or booking fees. Valuation fees would be paid at this point, unless they are covered by the lender as part of the mortgage deal.

Whether you’re buying or remortgaging mortgage lenders will ask a qualified independent surveyor / valuer to check that the property is valued correctly. They will also confirm suitability for mortgage purposes.

Different lenders use different terminology, some call the property inspection a survey and some call it a valuation, they are basically the same thing.

The cost for the different types of property inspection depends on the level of property inspection you have and which mortgage lender your mortgage is with. The choice of property inspections is;

A Standard / Basic Valuation is the minimum check mortgage lenders require to progress the mortgage for house purchases and is required by law.

A surveyor will inspect the property, highlighting obvious major defects that could affect the value, then compare the property to similar properties taking the age, condition and location into account. This information is used to write a standard / basic valuation report.

The RICS Level 2 (previously known as a Homebuyer’s report) is a more detailed report, with advice on defects affecting the property value, and details of any likely future maintenance or repair costs.

A Home Survey Level 3 (previously known as a Structural Survey) is useful for older, listed, large or non-traditional properties. It provides a thorough inspection and detailed breakdown of the property condition including any structural defects, necessary repairs and maintenance advice.

If the valuation is successful the surveyor will report this to the lender who will now be able to progress your mortgage application towards issuing a formal mortgage offer.

If the valuation is unsuccessful.

Sometimes the surveyor may recommend that the sale price is higher than the actual property value or the condition of the property isn’t up to standard. This may result in a downgrade the actual current valuation price of the property.

This can be quite common and may be down to many different factors including over pricing due to market conditions or structural issues with the property.

We don’t want you to buy a property that’s been over-valued, so we’ll contact you to discuss the different options open to you.

These may include asking the seller to reduce their price or agreeing to complete the necessary remedial works needed to bring this property up to standard.

If you agree a price reduction with the vendor this needs to be formally disclosed to the mortgage lender so they can adjust the purchase price and the mortgage borrowing if applicable.

You may decide on reflection that this particular house purchase isn’t for you, at this point you are not obliged legally to buy the property, you will not be refunded for any survey / valuation you have paid for.

You’re a big step closer to owning your first property, it’s time to get excited, but what are the next steps?

Once your valuation is complete, mortgage lenders will review the valuation report and carry out their final checks.

If your application has been accepted your mortgage lender will contact Parkview Mortgages and they will write to you and your solicitor with the formal offer and a Mortgage illustration document(s) explaining the terms of your mortgage.

Parkview Mortgages will review the mortgage offer to make sure the offer and product are the same as were originally recommended to you.

The offer is based on the details you provided in your original application, such as property purchase price, loan amount and your specific mortgage product.

If you want to make any changes to these, now is your final opportunity to do so.

This offer will come along with a ‘reflection period’ of at least 7 days, which will give you the opportunity to make comparisons and assess the implications of accepting your lender’s offer.

Some lenders might give you more than 7 days to do this.

You have the right to waive this reflection period to speed up your home purchase if you need to.

During this reflection period, the lender usually can’t change or withdraw their offer except in some limited circumstances. For example, if the information you’ve provided was found to be false.

Once the lender, solicitor and property vendors’ solicitors have agreed to proceed, the completion date for the mortgage is set. Sometimes your will be told exchange and completion may happen on the same date.

After contracts have been exchanged, the transaction becomes legally binding and neither party can withdraw or cancel without incurring financial costs.

It’s common for your solicitor to ask for a 10% deposit to be transferred to the seller’s solicitor at this stage.

As soon as you know your proposed completion date, you can start planning your move such as booking time off work and a removal company well in advance. You’ll also need to work out what items you need to buy to furnish your new home. Larger items such as sofas and beds can take weeks to arrive, so make sure you order them as soon as possible.

It’s vital that you have buildings insurance in place for your new home from the day you exchange contracts. In fact, most mortgage providers will make this a condition of lending. This is because you are legally responsible for the property from the moment contracts are exchanged.

Parkview Mortgages can assist you with your home insurance needs and we routinely discuss home insurance with our clients during our initial meetings.

Any recommended home insurance made by Parkview Mortgages will come with the correct levels of cover to satisfy mortgage lenders needs.

We can ensure the solicitors receive a copy of your home insurance scheduled in plenty of time to ensure no delay in the buying process.

Now you have exchanged your contracts it’s time to put the protection policies recommended by Parkview Mortgages on risk.

This means that the insurance provider will be told you have instructed Parkview Mortgages ask for any protection to be formally started.

Completion involves the mortgage lender handing over the funds required to buy the property to your solicitor.

Upon the final release of funds to the solicitor, the mortgage begins – this may be a day or two before the actual purchase is completed as mortgage lenders do need time to release the funds.

Solicitors like to ensure the funds are cleared in their accounts prior to the completion day so as to avoid any delay.

Your solicitor will need to pay any Stamp Duty owed; they will also arrange for the property to be registered with the Land Registry.

The estate agents should receive confirmation that the sale has completed and they should invite you to call into their office to pick up the keys for your new home.

Congratulations, you’re now a home owner.

Our journey together does not end here, we hope to be able to assist you throughout your mortgage life with regular mortgage, protection, and home insurance reviews.

There are no fees charged by Parkview Mortgages for future reviews.