First Time Buyers Bible

8/22/2019 First Time Buyers Bible

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First Time Buyer's Bible


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We are an independent, family-run estate agents, based inEaling.

Our team of property professionals are experienced in sales,lettings, block management and conveyancing. We have ourown in-house financial services and conveyancingdepartments, so you can find the answers to all of yourquestions under one roof.

We are passionate about property, but don't just take our wordfor it - come and visit us at our office in West Ealing, or give us

a call on 020 8998 1118 to discuss your property requirements.

Your property, our priority.

Address:23 The Avenue

West EalingLondon

W13 8JR

[email protected]

www.castlehillproperties.co.uk

020 8998 1118

visit our facebook page and 'like' us!

This handbook is a guide only. It is not intended as a comprehensivebuying reference.
http://www.castlehillproperties.co.uk/http://www.facebook.com/pages/Castle-Hill-Property-Services/358116017629621http://www.castlehillproperties.co.uk/


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To Buy or Not to Buy?

Buying a property is one of the biggestfinancial decisions you will ever make in

your life. It can be a daunting andconfusing experience, particularly forfirst time buyers, which is why it is

important to have an understanding ofthe process and what is involved.

The First Time Buyer's Bible will guideyou through the buying process, step-by-step and explain how it works. Wehave also included some useful hintsand tips, to save you time and money, as

you take your first step onto theproperty ladder.

Home Ownership Schemes

If you want to buy, but can't afford to goit alone, there are still options;

Buy with someone else: This is known asa 'joint' mortgage and can make thebuying process easier. For example,buying with parents, friends or a

partner.

Tenants in common: This means youjointly own the property, but you own ashare of the value, which you can giveaway, sell or leave to someone in your

will.

The Government have also introducedthree home ownership schemes, to helpfirst time buyers

First Buy equity loans

With a First Buy equity loan, you buy yourhome with at least 80% of the cost met by amortgage and a deposit. The rest is paid forby the government and the house builderthrough an equity loan.

The home will be in your name, which

means you can sell it at any time. Thegovernment and the house builder will get ashare of the value when you sell your home.If you dont sell your home, youll have topay back the equity loan after 25 years.

Shared ownership scheme

Shared ownership schemes are providedthrough housing associations. You buy a

share of your home (between 25% and 75%of the homes value) and pay rent on theremaining share.

Youll need to take out a mortgage to payfor your share of the homes purchaseprice.

NewBuy

NewBuy lets you buy a newly built homewith a deposit of only 5% of the purchaseprice. To qualify for NewBuy, your newhome must be:

New build being sold for the first time(priced 500,000 or less) Your main home Owned fully by you Built by a builder taking part in thescheme


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Deposits

So, you have decided to buy a property, butexactly how much can you afford?

You will need to take a good look at yourfinances in order to work out what you can

comfortably afford to pay. The easiest wayto do this is by creating a budget planner.This should account for all of your incomeand expenditure, over the course of amonth. (We have included a sample budgetplanner at the back of the bible).

There are some additional costs to take intoaccount at the beginning of the buyingprocess;

Lender's Valuation (Basic Valuation): Alllenders require a valuation of the propertyto check that it is worth the price beingpaid for it.

Legal/Conveyancing Fees: You will need tohire a solicitor to deal with the legal aspectsof buying a property:

Authority Search Fees: Local searches willbe carried out by your solicitor/conveyancerto ensure that there are no potentialproblems, such as planning permission onneighbouring properties or plans for newroads nearby.

Other Search Fees: These include indexmap, commons, the coal authority, landcharge, company searches, bank transferfees.

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You will usually need to put asubstantial amount down as a deposit.Ideally, you should try to put down atleast 15 per cent of the value of theproperty as a deposit, and more ifpossible.

However, some mortgage companies,(particularly localised building societies

that haven't been too affected by therecent banking disaster), are nowoffering mortgages and in return for 5 to10% deposits, but typically, the lower thedeposit requirements, the higher theinterest rate.

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Stamp Duty: Stamp duty is a tax,charged for properties above 125,001. If

your new home is priced between125,001 and 250,001, you will pay 1% ofthe property price. From 250,001 to

500,001, it will be 3% and over 500,001it will be 4%

Removal Fees: Ask for quotes from atleast 3 different removal firms, as prices

vary.

Budgeting


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Mortgages

Before looking at properties, you shouldalways consult an independent, whole of

market mortgage adviser, to find outwhat your maximum possible loan couldbe. This will be based on the size of yourdeposit and how much you earn.Lenders will usually lend up to threetimes the size of your annual income,although some will lend up to four times

your income. If you are buying as acouple, this increases to either threetimes the first income plus one year ofthe second income, or two-and-a-halftimes your joint income.

What are the different types of mortgages?

When deciding which mortgage to go for,there are two main things to consider;

1. Will you opt for a capital repayment orinterest-only mortgage?

With an interest-only mortgage, thepayment you make each month comprises

just of the interest you owe for that month.So you are not paying off any of the capital.

With a capital repayment mortgage, yourmonthly repayment consists of the interest

you owe, plus a percentage of the capital.2. What kind of interest rate will you pay?

There are a number of options as far asinterest rates are concerned. You canchoose a 'fixed-rate' mortgage, (a fixedprice over a number of years), a 'tracker'rate, (which can be capped) and theinterest fluctuates with the Base Rate. Thetracker rate can go down but it wont go up

above a certain level.

On the next page, we have attached amortgage budget planner, so you can startbudgeting for the various costs associated

with buying a property.

Book an appointment with our in-house financial adviser at our weekly'Mortgage Clinic'. The adviser willhelp you get your finances in order,work out a budget and find the bestmortgage deal for you.

See the Mortgage Clinic page at theback of the Bible for moreinformation.


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MONTHLY INCOME

Monthly Salary (after tax)

Other Monthly Income

TOTAL MONTHLY INCOME

MONTHLY EXPENDITURE

Credit Card Payments

Gas

Water

Electricity

Telephone (Landline)

Telephone (Mobile)

Council Tax

Food Bill

Clothing/Footwear

Car Tax/MOT

Car Insurance

Car Maintenance

Petrol

Commuting/Travel Costs

Life Assurance Premiums

Regular Savings & Pensions

Loan Repayments

Other Standing Orders & Direct Debits

Home Maintenance

Socialising/Entertainment

Any Other Expenses

TOTAL MONTHLY EXPENSES

Mortgage Budget Planner


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Looking for a new home is a time-consuming process and it is tempting justto rush into buying the first one you like

the look of. But once you have decided tobuy a house and found out how much youcan afford, it is worth sitting down andthinking about what you want from yournew home and what your needs are. Wehave made a list of some of the things youshould consider:

Style of Property: Do you want a brandnew build or a period property? Does it

matter whether it is terraced, semi-detached or detached?

Location, location, location: It isimportant to research the neighbourhood

you want to live in before viewing lots ofhomes or making an offer. It is also worthdoing two viewings; one during the dayand one at night and maybe one duringrush hour.

Amenities: Check out the schools, leisurefacilities, parks, activities for kids, shops,public transport and so on.

Commute: Is the location convenient foryour commute to work?

It is also useful to keep abreast of markettrends in the area you want to buy in.Gentrification is a key indicator of an area

which is improving and where houseprices are more likely to go up. Key signsof gentrification include an abundance ofcafs and trendy home design shops.

Another sign of a good area to invest in isone with a lot of interest from propertydevelopers. Find out if any new flats and

homes are being built. Local newspapersand council websites are a good source ofinformation about planning activity.

The Search

All properties in England and Wales areeither freehold or leasehold. Freeholdmeans that you fully own the property. Asa freeholder you will have fullresponsibility for the maintenance andrepairs of the property.

If you own a leasehold property, you onlyown it for a fixed period of time.

Youll have a legal agreement with thelandlord, called a lease. This tells you howmany years youll own the property.

When the lease comes to an end,ownership of the property returns to thelandlord. Leases can be extended, but theshorter the lease, the higher the cost ofextending it.

Most flats are leasehold. Houses can beleasehold too and usually are if theyrebought through a shared ownershipscheme.

Leasehold v Freehold


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Outstanding Primary Schools

Christ the Saviour C of E Primary SchoolSpringbridge RoadNew BroadwayEaling

W5 2XA

Montpelier Primary SchoolMontpelier Road

EalingW5 2QT

Outstanding High Schools/Sixth FormColleges

Twyford Church of England High SchoolTwyford Crescent

ActonLondon

W3 9PP

Transportation

Ealing has good tube links, being located onthe central and district lines. The Piccadillyline is served by nearby Ealing Common,Northfields or Boston Manor Station.

The new high speed 'Crossrail' link willfurther improve transport connections to

and from Ealing, but will also make Ealing amuch more desirable location to invest inproperty.

A number of major bus routes pass throughEaling (207, 65) and there are plenty ofsmaller routes connecting Ealing to thesurrounding boroughs.

Ealing, (also known as Queen of thesuburbs,) is the third largest boroughin London and the forth mostethnically diverse borough in thecountry in terms of sheer number.

Attractions

Ealing is home to the world famous'Ealing Studios', which is the oldestcontinuously working studio facilityfor film production in the world.

Pitshanger Manor Gallery & House isEaling's flagship cultural venue andcomprises of the Grade I listedPitzhanger Manor-House, designed bythe architect John Soane in 1800 andPM Gallery, which is West London'spremier professional contemporaryarts venue.

Questors Theatre is the largestcommunity theatre in Europe.

Parks

Ealing has ten key parks, which aregenerally the largest and most used

sites in the borough.

Walpole Park is Ealing's premire park.It hosts the annual Ealing SummerFestival, which comprises of Comedy,

Jazz, Blues, Opera and World Music.The festival attracts thousands of

visitors each year and entry is just 1.

Schools

Ealing has 91 state-run schools andnurseries, with a number of schoolsattaining 'outstanding' or 'good'Ofsted ratings in 2012.

Reasons to buy in Ealing


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5.

The term 'Conveyancing' refers to all thelegal and administrative work associated

with transferring the ownership of land orbuildings from one owner to another. Theconveyancing process starts after an offerhas been made and accepted.

Once an offer has been accepted, amemorandum of sale (MOS) is sent to allparties associated with the sale andpurchase.

Once the seller's solicitor has the MOS,they will put together a draft contract andsend it to the buyer's solicitor.

Making An Offer

Conveyancing6.

To make an offer, you will need to get intouch with the sellers estate agent andtell them how much you would like tooffer for the property. If they dontaccept, you can increase your offer, butmake sure you dont pay more than youcan afford.

The selling agent has an obligation toinform the seller of all offers, in writing,

within 24 hours, except those which theseller has instructed the estate agent notto be passed on. For example, offersbelow a certain price.

The buyer's solicitor will then performthe relevant searches against thecontract and the buyer will have theopportunity to raise any issues andconcerns. i.e. when was the boiler lastserviced? The solicitor also has a legalobligation to the lender and will raisequestions and searches on their behalftoo.

Most people hire a solicitor or licensedconveyancer to undertake the legalside of buying their home.

We have a highly experienced,in-house conveyancing team,

who can manage this for you.

See our conveyancing table onthe next page to get an idea ofwhat's involved.


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7.

At the point of exchange, you will handover a security deposit which is non-refundable if you pull out of the sale. Thisis normally 10% per cent of the purchaseprice.

You will then sign a copy of the contract,which is passed to the seller, and theseller signs a copy of the same contract

which you receive. Once contracts havebeen exchanged between both solicitors,both parties are legally bound to followthrough with the transaction. You can nolonger change your mind.

Your solicitor will deal with thefinalisation and signing of documentationrelating to your mortgage, and willarrange for the money to be available oncompletion of the sale.

Land Registry checks will then be carriedout by your solicitor, to make sure thatnothing is registered against the seller,such as undisclosed mortgages orunresolved disputes.

There will be various matters for you todeal with in the run-up to completion.There will be some documents to besigned and payments to be made andbefore completion, you need to makesure that all the terms of the contracthave been fulfilled, such as any repairs.

At this stage, you also need to be

arranging all the practical matters relatedto moving house.

Exchange Completion8.

On the day of completion, you will receivethe keys once the sellers solicitors haveinstructed the selling agent. This normallytakes place around midday. The seller isthen obliged to move out. You will pay the

seller the balance of the house through yoursolicitors and you will be given the transferdocument.

After completion, there will be some adminfor you to tie up and then your solicitor will;

Inform your mortgage lender, lifeinsurance company, and the freeholder thatthe sale has been completed

Register the transfer of ownership at theLand Registry.

Send the deeds to your mortgage lenderwho will keep them until you either sell theproperty or pay off your mortgage

Pay the stamp duty

Send you a statement of completion,

including a summary of the financialtransactions. (If you have not already paidtheir fees, they will ask for these now).

Congratulations, you've just bought yourfirst home!


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After the move

At Castle Hill, we care about what happens to our customersafter the sale. Whether you need a builder, a plumber, agardener or an interior designer, we have an extensive list oflocal, recommended suppliers from within the propertyindustry on hand to help.

Call us on 020 8998 1118 to discuss your requirements.

AC Builders: specialise in extensions,lofts, garages, basement conversions andrefurbishments.

Avenue Interiors: is a new kind ofdynamic interior design company. Weoffer hardwood flooring includingsanding and restoring floors, all types ofcurtains and blinds made to measure, as

well as all other aspects of professionalinterior design.

Caro Garden Design: offers a range ofservices, from garden redesign to workingout planting schemes and gardenmaintenance.

Charles Derby: provide services to helpyou improve your financial plans in everyaspect of your life. We have a dedicatedmortgage team, who run a weekly

mortgage clinic at the Castle Hill office,where our expert adviser will deliverfinancial information, advice andsolutions, which are clear and easy tounderstand.

Ealing Property Services: offer reliable andprofessional property maintenanceservices for commercial and privatebuildings. Services include; completepainting and decorating, wallpapering,carpentry, rewiring and electrical work,plumbing, tiling, water leak damagerepairs, tile repairs, window repairs, doorrepairs

Speed Removals: specialise in houseremovals, office removals, furnitureremovals and storage, as well as providinga comprehensive packing service.

Utility Bill Management: Castle Hill canorganise it so you receive all your monthlyutility bills in one single bill, saving youtime and energy paying bills to differentsuppliers. You are also guaranteed to savemoney. The single monthly bill

encompasses electricity, gas, broadband,mobile phone and land-line costs. Call usto find out more.

VR & Shaw Solicitors:cantake care of thelegal administration and paperwork for

your purchase, so you don't have to..


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Mortgages can be tricky to arrange and can involve a lotof paperwork. Charles Derby are experts in researchingand arranging mortgages for all sorts of people. Withaccess to a huge range range of providers from across themarket and with unique deals available, we aim to provide

the best deals for our clients, regardless of theircircumstances.

Book an appointment

with our in-housefinancial adviser, fromCharles Derby Wealth.

Book your free appointment today!

Call us on 020 8998 1118 or email us at [email protected]

FREE

MORTGAGECLINIC

Clinic Hours

Thursday Evenings: 18:00 20:15Saturday Mornings: 9.30 11.45 (Appointments last 45 minutes)

Want some free, impartial mortgage advice?

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