Guide to Moving or Buying your First Home - helpucover

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Guide to Moving or Buying your First Home - helpucover

Fills the gaps other insurance leaves behind

Make the Move

A Guide to Moving or Buying your First Home


You’ve made the decision - you want to move property, or buy your first home.

Now the minefield of information you need to know gets opened.

So where do you start?

Buying a new property can sometimes

be a long and complicated process and

even if you have been through it before

it can still be a bit daunting.

The good news is that if you have a good

understanding of the process and some key tips

on how to plan your move, you can avoid the

common mistakes that often make the process

more stressful than it needs to be.

There are a lot of things that need to be done

when you’re planning to buy a new home. Our

simple 10 step plan provides handy tools and

checklists to help you through each stage of

the buying process.

The 10 step plan to buying a new home

1. Work out how much can you afford and a realistic budget

2. Find out how much you can borrow and arrange your mortgage in principle

3. Choose where you want to live and arrange viewings of properties in the area

4. Make an offer on the property you choose

5. Get your mortgage offer agreed by your lender

6. Have a survey and valuation made on the property

7. Hire a solicitor to manage the sale for you and exchange contracts

8. Get ready for your move

9. Finalise the contract with the solicitor

10. Moving day!

Now let’s look at some of the steps in more detail...

A Guide to Moving or Buying your First Home - 2


Step 1. How much can I afford and what is a realistic budget?

The first stage in planning your move is to have a good

understanding of what your current outgoings are so you can

get a clear idea of how any new mortgage costs will fit into

your existing budget. It’s a good idea to do a budget planner

for your existing expenditure and then do a forecast of what all

your new outgoings will be when you move home.

You should make an estimate of what your new council tax will be and ensure

you have enough money to cover the one off fees that you will incur. We’ll

explain more about these later. If you’re thinking of buying a flat or leasehold

property you should also include any service charges or ground rent in your

budget calculations.

No-one has a crystal ball to work out what the economy is going to do in the

future. However, could you still afford the monthly repayment if the interest

rate on your mortgage goes up by 1%? It is worth working this out in advance

rather than running the risk of not being able to afford your new home over the

longer term.

Pulling together a budget

Simply add up your total post tax income from all sources and then deduct

expenses such as:

• Mortgage or rent

• Insurances

• Utilities

• Petrol/Public transport fares

• Cost of the weekly food shop

• Savings

• TV – cable/satellite

• Loan/credit card repayments

• Childcare

• Clothes

• Shopping

• Leisure

Try using our budget planner to guide you through.

A Guide to Moving or Buying your First Home - 3


Don’t get forget to budget for one off costs

A common mistake that people make when budgeting for their

move is to forget to take into account the one off costs you will

incur in the process. In addition to having the cash available to

pay your deposit you will also need to have funds available to

cover these costs.

Here’s a list of most of the one off costs you need to consider and why you

need to pay them:

Estate Agents Fees

It’s only if you have a property to sell that you’ll need to budget for these costs.

Estate Agents fees can be charged either as a fixed fee agreed in advance or

as a small percentage of the price you eventually sell your property for. You

should always ask for a detailed breakdown of what services are included in the

fees you agree to pay.

Mortgage Arrangement Fees

Some lenders charge fees to cover the costs of setting up the mortgage. If this

applies it will be drawn to your attention at the time you choose your mortgage.

Sometimes this fee is paid in advance or it can be added into the costs of your

mortgage which you pay back in your monthly repayments. Remember, if it is

added to the amount you borrow then you will pay interest on this fee during

the term of your mortgage. A broker fee may also be payable to your mortgage

advisor in return for their services. You should ask your advisor if a fee is

payable in advance of them completing any work for you.

Lender’s Valuation Fee

This is a charge made by the lender to value the property you intend to

buy to ensure that it is worth what they are lending you. This valuation is

commissioned by the lender and they choose who will do the valuation on your

behalf, even though you are liable for the costs.

When choosing your mortgage you should always ask what charges apply.

Sometimes lenders offer free valuations as an incentive for you to take out your

mortgage with them.

Survey Fees

When you have made an offer on a property and it has been accepted then it is

strongly advised that you arrange for an independent survey to be completed.

Legal Fees

The legal work involved in buying a house is known as conveyancing, which

a solicitor will do on your behalf. There is no standard cost for conveyancing

services so it is a good idea to shop around for the best rate. You will also

have to pay for the legal work done by your lender’s solicitor. If you opt to use

the same solicitor as your lender this can save you money but you should still

compare the costs to other providers.

A Guide to Moving or Buying your First Home - 4


Don’t get forget to budget for one off costs

Searches

These are checks made by your solicitor on your behalf and are usually

included in their charges. These searches check that there are no potential

planning problems such as planning permission on neighbouring properties or

plans for new roads nearby. These charges will usually be itemised under the

“Other fees and disbursements” section of your solicitor’s invoice.

Land Registry Fees

The Land Registry is a government department which holds records of the

owners of properties registered in England and Wales. When a property

changes hands there is a fee for transferring the register to the new owner. A

fee is charged for completing this service which also varies depending on the

value of your property. You solicitor will manage this for you and again this will

be itemised in the charges.

Stamp Duty

Stamp duty is a tax levied by the Government on all properties over £125,000.

The percentage payable is related to the value of your home at the time you

buy it. If you want to find out exactly how much stamp duty you will be liable

to pay see the HMRC website for more details www.hmrc.gov.uk/sdlt/intro/

rates-thresholds.htm You cannot borrow the amount you need to pay in

stamp duty as part of your mortgage so you need to make sure you have these

funds available in cash before you make a binding offer on a property.

Removal Fees and other costs

Most people hire a removal company to transfer all their belongings to the

new property. This will need to be booked as soon as you have a moving

date. Get a few quotes from some local companies to find the one which

suits you best. It’s also worth checking that the firm you go with has

insurance that covers any breakages whilst your belongings are in transit

as they will not be covered by your contents insurance.

Other costs you may not have thought of are any disconnection and

reconnection fees you may incur from utility companies (Gas, Electric,

Telephone and Sky) and the cost of any mail redirection. These should all

be taken into account.


Estate Agents may charge additional

marketing fees for advertising your

property in newspapers, which is not

included in their selling fee.


A Guide to Moving or Buying your First Home - 5


Step 2. How much can I borrow and how do I arrange a mortgage in principle?

Most people believe that when going for a mortgage they will

be able to borrow 3 ½ times a single salary and 3 times a joint

salary. However, in reality how much you can borrow depends

entirely on your personal circumstances. Whilst the lending

decision is mostly made based on your income and current

outgoings other factors such as your credit rating and how

much deposit you can put down relative to the amount you

want to borrow will also be considered.

In the current climate, most lenders would like you to put down at least a

20% deposit of the total cost of the property you want to buy. A further factor

lenders take into account is how long you have been in employment with your

current company and whether or not you are self employed.

Any mortgage application you make will be “scored” by the lender to see how

closely you match their criteria of who they want to lend to. Each lender has

their own criteria that they score against, however all lenders will reference

credit reference agencies to check that your credit rating is adequate. Your

“credit rating” is calculated by these agencies and is based on your history of

borrowing and repayment. It also takes into account any other financial assets

or liabilities you may have and whether or not you have any County Court

Judgements made against your name. If you have a low credit rating you will

be considered a higher risk and could therefore be offered a less favourable

interest rate or not offered a mortgage at all.

There are many reasons why you could have a low credit rating and although

a credit reference agency won’t tell you exactly how they calculate your score

you can find out what your score is and how you can improve it. Our useful

contacts section provides details of these agencies and how to contact them.

It is worth checking your credit rating in advance of making a mortgage

application as if you are turned down for credit this can further damage your

credit rating.

If you want to get a very rough idea of what you can borrow, what the monthly

repayments will be and at what interest rate online comparison tools can

be a good place to start. Based on the details you enter about yourself, the

aggregator will provide a list of mortgage deals for you to consider and usually

formats the information in a way that enables you to compare products on

a like for like basis. Once you have your list and worked out what you think

looks best you can then approach a lender directly or if you feel you need more

advice go to a Mortgage Advisor or Independent Financial Advisor.


If you have a low credit

rating you will be considered a higher

risk and could therefore be offered a

less favourable interest rate.


A Guide to Moving or Buying your First Home - 6


What type of mortgage should I go for?

When you take out a mortgage you agree to borrow a fixed

sum of money (referred to as the ‘Capital’) on which the bank

charges you interest. You are liable to pay back both the

capital and the interest over the term of the mortgage. The

choice between a Repayment and Interest only mortgage is

really a choice about how you pay back what you owe.

Repayment

This type of mortgage pays off the interest and the ‘Capital’ over the term of

the mortgage so at the end of the mortgage term, your home is fully paid off

with nothing being owed to your banks or building society.

Interest Only

With this type of mortgage, you only repay the lender the interest portion

of the loan so the repayments are cheaper. But the drawback is that at the

end of the loan period, you still owe the original amount you borrowed at the

start. To make sure you have the money to repay your lender, you will need to

invest some money over the term of the mortgage and be confident that those

investments will deliver enough return to pay back the loan. Here are examples

of the various investments you could use to build up your funds:

Endowment policy

This is a form of savings with life assurance included. They are not generally

available for new sales now, but if you have one already, you could use the

amount you get at the end of the policy to offset against your mortgage.

Pensions

Pensions are tax efficient as you will receive tax relief on the payments you

make to your policy. The fund you build up within your pension can be used

on retirement to ‘buy’ a lump sum from the pension provider. This can then

be used to repay your mortgage. In addition, you will also receive a monthly

income from the pension policy. You have to meet certain criteria for a pension

policy, and make sure that you will be old enough to take the lump sum from it

when you will need to have repaid your mortgage – generally, the youngest age

you can take benefits is 55.

ISA

This is a tax-efficient savings policy – all the interest you get paid from it is tax

free. So over a number of years, your savings can grow to give you an amount

to repay your mortgage. The interest you will receive can go down or up,

depending on the economy. Having made the decision how you want to pay,

the next stage is to compare the types of mortgage available.

A Guide to Moving or Buying your First Home - 7


Jargon Busting

There are many different types of mortgage available on the

market and it’s important that you understand fully what you’re

signing up to. These are the main types:

Fixed rate

This means that the rate of interest you pay will remain ‘fixed’ for an agreed

amount of time usually a number of years. Terms of 2, 5 or 10 are most

common. This type of mortgage is great if you want certainty of what you’re

going pay each month to help you budget. However, if general interest rates

drop you will not benefit from this reduction. At the end of the initial term the

interest rate is fixed for the mortgage will revert to the lenders standard variable

interest rate. It’s often at this stage people review their mortgage deal against

what is available at the time.

Variable rate

With this type of mortgage your payments can go up or down throughout the

term of the loan. If the mortgage rate changes, your repayment will change. If

you opt for this type of mortgage you should make sure that

you have sufficient budget to take into account any increase that may occur

in the future.

Trackers

This is a type of variable rate mortgage but the interest rate is linked to the

Bank of England base rate. The interest rate you are charged is usually 1 to 2%

above the Bank of England base rate. As the Bank of England rate changes

your mortgage rate will increase or decrease in line with that change.

Capped rate

This is a type of variable rate mortgage where a ‘Cap’ is set at the outset which

is an agreement with the lender that your mortgage rate will never exceed an

agreed percentage rate. This means you can benefit from any rate reduction

that occurs throughout the term of your mortgage whilst having the comfort

that you always know what the maximum budget you will need to set aside for

your mortgage repayments.

Cashback mortgages

These mortgages give you back a cash lump sum at the beginning of the

mortgage. Although the cash may help you cover some of the fees you

incur when you are moving house, you should compare the costs of these

mortgages with other deals available.

A Guide to Moving or Buying your First Home - 8


Jargon Busting

Offset mortgages

These types of mortgages combine a traditional mortgage loan with any

deposit accounts such as savings or current accounts you may have. An offset

mortgage works on the basis that for the calculation and charging of interest,

the outstanding mortgage debt is offset against any savings or money you have

in your current account. So if you had a mortgage of a £100,000 for example,

savings of £9,000, and £1,000 in a current account for the purpose of calculating

interest the £100,000 is offset to the £10,000 worth of savings. This means, you

would only be charged interest on £90,000 of your mortgage borrowing.

Irrespective of which route you take you should ensure that before you

commit to making an application that you know the following:

• All the costs associated with the mortgage – interest rates, application

fees, broker fees and the costs of valuations

• Whether or not the costs are payable up front or are added to the loan

• What the penalties are if you repay the loan early

• What rate of interest applies after any introductory offer period

has finished

• Is the mortgage portable if you decide to move again

• If there are any charges if you decide after making a mortgage

application not to proceed

A Guide to Moving or Buying your First Home - 9


Getting a Mortgage Agreement in Principle

Once you have chosen the lender and the mortgage you would

like to go with, the next stage is to get a Mortgage Agreement

in Principle from them. You will go through an application form

to establish whether the lender is prepared to lend you the

mortgage you have asked for.

You will be asked for details of your employment and your income and

outgoings. If you have a current mortgage you will also be asked for

details of that too. The lender will give you a yes or no decision based on this

information but you need to remember that this is an Agreement in Principle

and not a binding mortgage offer. This cannot be completed until you have

decided on the property you want to buy and the lender has valued it to be

confident it is worth the money they are lending to you.

A Guide to Moving or Buying your First Home - 10


Step 3. Choosing your home and viewing properties

Before you get down to looking at specific properties you

should really think long and hard about the type of area and

neighbourhood you want to live in.

The location of a property is one of the biggest factors in how much its worth

and how easy it will be to sell in the future so it’s important to get this right. If

you’ve lived in an area all your life you’ll already have a good idea of where the

best places to buy are. However, if you’re thinking of relocating it’s really worth

having a drive around the various areas you’re considering at different times

on different days to get a better feeling of what it would be like to live there. It’s

worth trying to do the journey to work in the morning from your chosen area

to see what it’s like at rush hour. It’s also worth walking around the area at

different times of day to see what the neighbourhood is like and check out how

comfortable you feel.

If you want to know whether you’re moving to an up and coming area, a good

indicator is something called ‘Gentrification’. This is when an area has an

abundance of cafes, bars and trendy design shops. Another good sign is if new

homes or flats are being built in an area by property developers.

www.upmystreet.com and www.zoopla.co.uk are just two of the websites

on the internet that contain a wide range of information about local house

prices and trends, schools, crime rates and much more. The local government

site www.direct.gov.uk can also give you information about schools, local

activities, transport links etc which can also help you with your decision.

Things to consider:

• How far away from family and friends will you be?

• Is it close to schools you want your children to go to? Will you be in the

catchment area for these schools?

• Is public transport essential to you for commuting – if so, how far away

from stations/buses can you be?

• How close to shops and amenities do you want to be?

• Will you have enough car parking spaces?

• What council tax band will you be in?

• Is there easy access to healthcare?

– Hospitals, GPs etc

• What is the level of crime in the area? Getting a copy of the local

newspapers will give you a good idea of this.

• What is the neighbourhood like? Are the other houses in the street in

good condition? If they’re poorly maintained or the area generally looks

a bit shabby this could bring down the value of your property.

Once you’ve narrowed down the search a bit more it’s worth speaking to

people who actually live there and ask for their honest opinions of the best and

worst points of the area.

A Guide to Moving or Buying your First Home - 11


Now the search begins! Looking for your ideal property

A good place to start looking is online property sites. These

sites will give you access to a range of estate agents with

properties that are currently on the market in the area you want

to move to.

Property sites that are currently very popular are www.rightmove.co.uk,

www.primelocation.com, www.findaproperty.com, and www.zoopla.co.uk.

Not all the properties available in a particular area will be advertised on these

sites. Some independent estate agents may not advertise with these sites so

it’s still worth visiting local estate agents offices and looking in the property

pages in the local newspapers.

If you’re not in a hurry to move and fancy buying a brand new property,

another place to look is house building companies. You will usually only be

able to visit a show home on the development and you have to be prepared

to buy your home “off plan”. Buying a house before it’s even been built can

be a little too nerve racking for some people.

Auction properties are normally redevelopment projects, repossessions or

estate sales where the property has been vacant for some time. Unless you

have experience it’s probably best to leave it to the experts. This is the reason

why many of the properties sold at auction are to builders and property

developers. If you want to explore this route you can get some

further guidelines on buying at auction from www.uknetguide.co.uk.

Leasehold or Freehold?

When choosing which properties to go for you should always check whether

or not the property is sold as Freehold or Leasehold. Freehold means that you

own the land on which the property is built. Leasehold on the other hand does

not include the land on which the property is built – instead you pay a ground

rent to the owner of the land – the freeholder. You only have the right to

occupy the property for the length of time left on the lease. It is common for

Flats to be sold on a leasehold basis. It is always worth checking the amount

of time left on the lease for any leasehold property as this will affect the value

of the property.

Another source of properties for sale is property auctions. Although buying a

home at auction can be cheaper than buying through other traditional routes

it is also much riskier as you will be unable to get the property surveyed

before you start bidding. You will also be required to have the full mortgage

offer agreed in advance and you will have to get your solicitor to do some

work in advance to ensure that there are no legal issues with the property you

propose bidding on.

A Guide to Moving or Buying your First Home - 12


Getting the best from viewings

Once you have made a shortlist of properties you’re interested

in you should contact the estate agent to arrange a time for

you to view. When you visit the property you should make

notes about the property against the following criteria:

First Impressions

How closely does the property meet your wish list? What is the general state

of repair and general decoration of the property? What fixtures and fittings are

included in the sale? Fixtures and fittings include kitchen appliances, carpets

and curtains. What is the state of repair of the rest of the houses in the street?

Does this suggest the area is thriving or going down hill?

Heating, power and plumbing

Is the property centrally heated? If it is how old is the system? When was the

last time the boiler was serviced? Is the roof well insulated? If you go in the

loft and turn off the light you shouldn’t be able to see any patches of daylight

through the roof. Is the house fully double glazed? How old is it? Are the

pipes and the boiler lagged? How old is the plumbing? How old are the plug

sockets and light switches? Old fashioned switches may suggest that the

house needs rewiring.


The best house hunters write notes

on each property they view and

compare them. This enables you to

get a good sense of what you can get

for your money.


Potential problem areas

Subsidence

Look out for evidence of subsidence. From the outside of the house you should

look for big cracks in the walls, a bent chimney stack or an uneven roofline.

From the inside look for big cracks in walls or ceilings and also try shutting the

internal doors. Doors that stick or don’t hang correctly could

also suggest subsidence.

Damp

A musty smell when you enter the property could indicate that it has a damp

problem. Look for mould, or discolouration to paint or wallpaper. Flaking wallpaper

or paint could also be due to damp. From the outside you should also

check for missing roof tiles or cracks in the brickwork which could also

let in damp.

Woodworm

This is harder to check for but lots of small holes in banisters, door frames and

floor boards could indicate woodworm.

Root damage to foundations

If there are any very large trees close to the property this can cause problems

which a survey should identify.

A Guide to Moving or Buying your First Home - 13


Step 4. Making an offer

Although the Estate Agent will have detailed what the sellers

asking price is you should not make the mistake of assuming

this is what you have to pay for the house you choose.

Ultimately, a house is only worth what someone is prepared to

pay for it and there are many factors that can affect what price

the seller will settle for.

It’s worth doing some research on how much comparable homes in the area

have sold for. Although the value can differ if there have been extensions

or renovations completed this information provides a useful benchmark on

what houses in the area you’re going for can command. Websites such as

www.mouseprices.co.uk and www.nethouseprices.co.uk provide data

based on the sold prices for properties registered with the Land Registry.

It’s definitely worth haggling - start by making an offer that is less than the

asking price. The seller can always try to negotiate upwards but you’ll find it

much more difficult to try and reduce an initial offer if you go straight in with the

asking price.

You should always confirm that any offer is “subject to contract and survey”.

This means that you are not legally bound to proceed until a satisfactory

survey and legal contracts have been completed. Make sure that your offer

is confirmed in writing and details what fixtures and fittings you expect to be

included in the sale.

As soon as you have made an offer which is subject to contract and the seller

has accepted it you should request that the seller takes the house you want

Top Tips

When making an appointment to view a property it’s worth asking the

seller or estate agent the following questions:

• How long has the house been on the market?

• How much interest has been shown?

• Are the sellers looking for a quick sale?

• Have the sellers already found somewhere they want to move to?

• What is the reason the seller is moving?

The answers to these questions will give you a view on how open the

sellers will be to you making an offer which is below the asking price.

to buy off the market. This prevents a situation where another potential buyer

could “gazump” you by offering more than you have whilst you’re getting you

mortgage and the legal contracts sorted.

In Scotland the legal process which applies when buying a house is different to

that for the rest of the UK. Once you have agreed the details of an offer with a

seller you are legally bound to go through with the sale and could be subject to

pay any damages if you decide to pull out. As this is the case it is best to engage

a solicitor to manage the offer process for you when buying a house in Scotland.

A Guide to Moving or Buying your First Home - 14


Step 5. Get your mortgage offer agreed with your lender

In order to complete the full mortgage application you will need to provide

the following:

1. Proof of your identity

This means that when applying for your mortgage the lender will need to see

a copy of your passport, driving licence or birth certificate. They will also ask

you for your National Insurance Number.

2. Proof of your address

Lenders will require you to provide proof of your address (es) for the last 3

years. Utility or council tax bills are acceptable for this purpose.

3. Details of your employment

The address and contact details of your employer. If you’re self employed

they may ask for full details of your accounts so ask in advance of making

your application what kind of evidence they need to see.

Lenders can only make a binding mortgage offer at this stage of the process

as the money they will lend you is secured against the specific property you

will want to buy. Depending on how long it’s taken you to find the perfect

home, the lender who gave you the mortgage offer in principle (step 2) may no

longer offer the mortgage you applied for and there may be better deals on the

market. Once you’ve shopped around to secure the best deal the next stage is

to complete a full mortgage application.

4. Details of your financial situation

You’ll be asked for copies of your recent pay slips as proof of your income.

You’ll also be asked to supply documentation about any outgoings you have

such loans, credit cards and store cards as well as copies of your recent

bank statements. The lender will also ask for a detailed breakdown of any

savings, investments or any other properties you may own.

5. Current mortgage

If you have a mortgage currently, you will be asked for a copy of your latest

mortgage statement and a redemption statement from your current lender.

6. Full details about the home you want to buy

This includes the property details you’ve been given about the home you

want to buy and how much you’ve agreed to offer for it, the choice of the

mortgage product you wish to go for, the valuation/survey requirements,

your mortgage protection insurance requirements, your home insurance

requirements, you solicitor’s/convenyancer’s details

Unlike your application for a mortgage in principle this application will require

more detailed information about the property, the type of survey you want and

the details of a solicitor you will use. They will also require evidence of your

income and outgoings. You will not receive a confirmed mortgage offer until a

valuation of the property you want to buy has been completed by the lender as

they will want to be certain that the house is worth what you want to borrow

from them. This is the next key step in our guide.

A Guide to Moving or Buying your First Home - 15


Step 6. Have a survey and valuation made on the property

Your lender will get a valuation completed on the property

to check that it is worth what you are paying for it. If the

valuation completed by the lender is less than that which you

have offered to the seller then your mortgage offer may be

withdrawn or be made subject to certain repairs or renovations

being completed. If this happens you should ask the surveyor

who completed the valuation on the lenders behalf to explain

fully why they believe the property isn’t worth what you have

offered. This should give you all the information you need to be

able to renegotiate your offer price with the seller.

Although a surveyor completes the valuation for the lender, this should not

be confused with a full survey. A valuation will not give you any details on any

structural problems there may be with the property that you will need to fix, it

only focuses on whether the price you want to offer is worth the property in its

current state.

If you want to be sure there are no major issues with the property you intend

to buy, the only way you can really be sure of this is by commissioning an

independent survey. A survey will identify any major work that might need

doing, things that you as a non-expert would not be able to spot.

Although you may think this is a cost you can’t afford, it is far cheaper to have

a survey than to fix major structural faults once you have bought the property.

A survey should always be completed before exchanging contracts so that any

major faults can be put right before you move in or you can renegotiate the

asking price of the property to take into account the costs of any work which

need to be done.

The estate agent, your solicitor or the lender will all be able to recommend a

surveyor they have used. If you decide to use the same surveyor the lender is

using for the valuation this can often save time and money as your survey can

be done at the same.

Types of Survey

There are two types of independent survey a Home Buyers report or a more

comprehensive Structural Survey (also known as a Building Survey).

Home Buyer’s Report

A Home Buyers report is usually for standard properties in a reasonable

condition up to 150 years old. It will check for major faults and give you the

estimated costs to put things right.

A Structural Survey

A Structural Survey is a more comprehensive survey that is usually used for

older, unusual or listed buildings. These surveys are also advised for properties

that have had extensions or renovations. A Structural Survey may highlight

that further reports are required from specialists so you should be prepared for

these costs too.

If you are buying a newly built home you won’t need a detailed survey

as it should have a NHBC certificate. A National House Building Council

certificate gives a 10 year guarantee, covering any major fault or problem in

your new home.

A Guide to Moving or Buying your First Home - 16


Step 7. Hire a solicitor to manage the sale for you and exchange contracts

The legal work in buying a house is known as conveyancing,

which can be a complex process both legally and administratively

which is why it is best for a solicitor/conveyancer to do this

on your behalf. Once the survey has been completed and is

satisfactory and you have received your formal mortgage offer

your solicitor will get in touch with the sellers solicitor to draft

the contract.

It’s your solicitor’s job to highlight anything in these searches and enquiries that

may make you want to pull out of buying the property prior to you exchanging

contracts with the seller.

Once all checks are made and you are happy with the draft of the contract,

your solicitor will need to agree a date for when the sale will be finalised.

This is called the completion date and it is the point at which you take legal

possession of the property. Once all the detail is agreed you will be ready to

exchange the final contracts for signature by you and the seller.

Part of the contract will also include things that are to be left in the house. Here

are some examples of things that could be included: carpets, ceiling and wall

lights, curtains, bedroom furniture, bathroom fittings and garden sheds.

When you exchange contracts you will need to hand over the deposit to the

solicitor. Once the contracts are exchanged and signed both parties are legally

bound to go through with the transaction. If you decided to pull out of the sale

at this stage its very likely you would lose your deposit and you could potentially

be sued for breach of contract.

If you have agreed that the seller would do any repair work on the property as a

condition of the sale it’s important that you check that this has been done as it

will hold up the completion of the contract.

Your solicitor will cover the following things for you:

• Check the title deeds of the property to ensure there are no issues

• Make checks to make sure that any planning permission the current

owner has have got the relevant sign-offs or certificates from the

government planning department

• Check the local authority maintains drains, streets and pavements

• Will draw up the contracts between you and the seller of the property

(liaising with the sellers solicitor)

• Register the change of ownership with the Land Registry

• Request any searches from the local authority of information about

the property and any planned developments within the area which

may affect your property, such as a major road being built or local

business planning expansion and building work

A Guide to Moving or Buying your First Home - 17


Step 8. Getting ready for your move

By working with your solicitor whilst they are drafting the

contracts you will have agreed the date when you want to

move in. As your completion date comes closer, there are

various tasks you’ll need to complete and companies you will

need to let know about your change of address.

Key things you need to do as soon as possible

• Book time off work around your confirmed moving in date

• If you’re renting give notice to your landlord

• Book the removal company or hire a van if your family and friends are

helping you move

• Contact utilities companies (Gas, Electricity, Water and Telephone) to give

them notice your moving date

• Contact the Council Tax office and tell them your moving date

• Arrange any insurances that are a condition of your mortgage

• Start Packing!

Top tips on packing

The key thing is – don’t leave it too late! Start packing your things up as early

as possible. Get everything you need – boxes, thick parcel tape, labels, black

bin bags and protective bubble wrap for your fragile possessions.

Closer to the moving day:

• Check what time you can get access to your new home

• Confirm these times with your removal firm

• Speak to neighbours at your old and new house to make sure they leave

parking space for the removal van

• Contact the sellers to check that you know where water cocks, fuses boxes

and gas/electric/water meters are

• Arrange for a parking permit if you need one at your new house

• Ask the seller to clearly label all window, garage, shed keys etc and agree

one place where you’ll be able to find them

• Ask the seller to put all important manuals (central heating, kitchen

appliances etc) in one place

• Start working your way through all the people you need to contact about

your address change

Clearly label all your boxes with:




The room they need to go into at the new property

Whether they are fragile. It may be a good idea to get some ‘Fragile’

stickers to put on the boxes so that they can be clearly seen

If necessary, which way up they should be carried

Your removal company will be able to advise you on how to pack and which things you should pack first.

A Guide to Moving or Buying your First Home - 18


Key contact checklist

Our checklist should give you a good

idea of most of the people who you

will need to contact when you move.

Its worth arranging with Royal Mail for

any post to be redirected to your new

address just in case you have forgotten

anyone. Details of this can be found at

www.royalmail.com/personal and can

be arranged for 1, 3, 6 or 12 months,

with varying costs depending on the

length of time you choose.


Royal Mail to get your post redirected


Your employer


Your children’s school or nursery


Gas


Electric


Water


Phones – landline and mobiles


Council tax


Sky/Virgin TV


Internet provider


Banks


Building societies


Credit card companies


TV licence


Car insurance


Buildings and Contents insurance


Life assurances


Any income protection insurances


Doctor


Dentist


Optician


Vet


DVLA to get your driving licence

updated with your new address


Inland Revenue


Friend and Family

A Guide to Moving or Buying your First Home - 19


Protecting your investment

Buying a new home is the biggest investment you are ever

likely to make so it’s important that you have appropriate

insurance in place to protect it. The key insurances you may

need are detailed below:

Buildings Insurance

Buildings insurance covers you for any damage to the structure of the property

and essentials such as kitchen and bathroom fittings. The level of buildings

insurance cover you need must be enough to cover the cost of rebuilding your

home in the event of severe damage however this is not the same value as

the price you paid for it. The rebuild cost of your home will be included in your

surveyors report or valuation. Some buildings insurance policies include cover

for legal expenses. Although this is not essential it may be worth considering as

it covers the costs of any private legal actions you may need to take to resolve

issues with nuisance neighbours or disputes on right of way. For freehold

properties most lenders will insist on seeing a copy of your buildings insurance

certificate before they will release the mortgage funds so you need to get this in

place to avoid any delays. Make sure you have the buildings insurance in place

from the date you exchange contracts.

Contents Insurance

Contents insurance covers your personal possessions. This is not an insurance

policy that mortgage lenders insist upon you having but it does make sense

to have cover in place. To calculate how much cover you will need go through

every room in your house and make a list of what’s in there and estimate of

how much it would cost to replace. This should include the costs of replacing

carpets and curtains. This will give you the level of cover you should insure your

contents for. Most contents insurance covers have what is called a single article

limit which is the maximum amount of benefit that they will pay for any single

item. If you have some really valuable items such as jewellery or paintings make

sure you draw this to the insurer’s attention. You can arrange cover for these

items but they will need to be specified separately from your other contents and

sometime you will need to pay an additional premium to cover them.


The level of buildings insurance cover

you need must be enough to cover

the cost of rebuilding your home in the

event of severe damage


A Guide to Moving or Buying your First Home - 20


Protecting your investment

Life Insurance

Some lenders insist that you have sufficient life insurance in place to pay off

your mortgage in the event of your death. However, even if they don’t you

should consider taking out cover to ensure that your family and dependents are

covered should the worst happen. The main types of life insurance are:

Level Term Insurance

Pays your family a fixed cash sum that remains the same throughout the term

of your policy.

Critical Illness Cover

Pays out a lump sum if you are diagnosed with certain specified illnesses during

the term of your policy. It can be obtained as stand-alone cover or as part of a

life insurance policy.

Income Protection

This type of protection will give you a regular monthly income if you can’t work

as a result of accident, sickness or unemployment.

Mortgage Payment Protection insurance

This type of insurance will cover you if you are made redundant or have an

accident or are ill. It will pay your monthly mortgage payments and insurance

premiums, usually for up to 12 months.

For more information and a quick insurance quote visit:

www.helpucover.co.uk

Mortgage Life Insurance or Decreasing Term Assurance

Designed to pay off your mortgage in the event of your death with the benefit

amount decreasing in line with your outstanding mortgage balance.

A Guide to Moving or Buying your First Home - 21


Step 9. Finalise the contract with your solicitor

The final step you will complete with your solicitor to finalise

the sale is called completion. As the completion day comes

closer you should keep in close contact with your solicitor

to make sure everything is on track. The following things will

happen at completion stage:

1. Your solicitor will liaise with your mortgage lender and ensure the money

transfers into their holding accounts.

2. The outstanding balance that you need to pay for the house (the agreed

purchase price less the deposit) will be paid to the seller by your solicitor.


As the completion day comes closer

you should keep in close contact with

your solicitor to make sure everything

is on track.


3. The legal documents transferring legal ownership of the property (transfer

document and title deeds) are passed to your solicitor. These are usually

held by your mortgage lender until the full mortgage has been repaid.

4. You should have provided your solicitor with all funds needs to pay all

the extra costs that are incurred in moving such as stamp duty and Land

Registry Fees.

5. Your solicitor pays the additional fees on your behalf

6. Your solicitors completes a set of final accounts detailing all the money

they have handled on your behalf

7. You can collect the keys as the seller has to have vacated your new home.

A Guide to Moving or Buying your First Home - 22


Step 10. Moving Day!

The big day has arrived and after months of planning you’ll

finally be able to move into your new home. Moving day can be

stressful but hopefully the following tips and hits will help you

ensure that things go as smoothly as possible.

As soon as you wake up

Make sure that your neighbours have remembered that today is your moving

day and have left sufficient space for your removal van in front of your house.

Take your pets to a family or friends before the removal firm arrive. You don’t

want the removal men tripping over your pet or run the risk of losing them as all

your doors are likely to be left open whilst the removal van is being loaded.

Take final meter readings for your gas and electricity and ring these through to

the utilities company.

When the removal men arrive

Explain everything that you are taking with you, what boxes contains things

which are fragile and what is being left behind. As soon as this is done the

best thing to do is keep out of their way as the removal firm will know how the

removal van needs to be packed to ensure everything fits in.

Whilst the removal van is being loaded, take a little time to say goodbye to your

neighbours and give them your new address.

Keep Essentials in Easy Reach

Put together a box of essentials that you’ll need as soon as you move to

your new home. Key things to include:


The kettle, mugs, tea, coffee, milk and sugar.


Your mobile phone charger


Cleaning materials, bin bags and a dust pan and brush


Toilet paper


Light bulbs and a torch


Pen and notepad


Leave your address and contact details

on a piece of paper in the kitchen of

what is now your old house asking for

the new tenants to forward on any mail

which isn’t automatically redirected.


A Guide to Moving or Buying your First Home - 23


Moving Day!

At the new house

Make sure you arrive before the removal men so you can direct

them where you want them to put your belongings. If you’ve

labelled up your boxes when you packed them, this process

becomes much easier to manage.

Check that all the utilities are connected and take meter readings. You should

contact your utilities companies as soon as possible and give them this start

reading as the basis from which you’ll be billed in the future.

Unpack the boxes which go in the kitchen and your bedroom first. These are

the key rooms that you need to be able to use on the day you move in.

Put the kettle on and enjoy your new home!

A Guide to Moving or Buying your First Home - 24


About helpucover

helpucover opened its doors in 2007, and since then has

worked tirelessly to help customers make sense of insurance

and get the cover they need. We pride ourselves on our

different approach to insurance – offering simple, flexible

products that our customers can personalise in a way that

suits them best.

helpucover has other guides available which you can

download from www.helpucover.co.uk

Guide to Buying Household Appliances

Our products don’t just provide a cash payment when the worst happens

but also include a range of useful services that you can use to help you get

back on track or adapt to a change in your circumstances.

Our aim at all times is for customers to be empowered by having information

that is easy to understand which helps them make the choices that are right for

them. This is why we have created this guide which we hope you found useful.

Simple Guide to Choosing, Owning and Caring for a Pet

Simple Guide to Buying a Car

A Guide to Moving or Buying your First Home - 25


Useful Contacts

Buying or Selling a Home

Council of Mortgage Lenders – contact for information

about mortgages

www.cml.org.uk/cml/consumers

Energy Performance Certificate Register – for details

about Energy Performance Certificates

www.epcregister.com

Home Report Scotland – for details about Home

Reports that are only required in Scotland

www.homereportscotland.co.uk

HM Revenue & Customs – for details about Stamp Duty

www.hmrc.gov.uk/sdlt

Property Search Websites

Right Move

www.rightmove.co.uk

Prime Location

www.primelocation.com

Find a Property

www.findaproperty.com

Zoopla

www.zoopla.co.uk

Credit Reference Agencies

Companies you can contact to find out your credit score

Call Credit

www.callcreditcheck.co.uk

Equifax

www.equifax.co.uk

Experian

www.experian.co.uk

Mortgage Advice

Which

www.which.co.uk/lendersrated

Money Saving Expert

www.moneysavingexpert.com/mortgages

Financial Ombudsman Service

www.financial-ombudsman.org.uk

Association of Independent Financial Advisers

www.aifa.net

Association of Independent Mortgage Intermediaries

www.a-m-i.org.uk

Estate Agents

National Association of Estate Agents

www.naea.co.uk

Guild of Professional Estate Agents

www.guildproperty.co.uk

House Prices

Land Registry House Price Index

www.landreg.gov.uk/house-prices

Registers of Scotland: Scottish house prices

www.ros.gov.co.uk

House Price Index

www.nationwide.co.uk/hpi

RICS housing market survey

www.rics.org/housingmarketsurvey

Other online resources

www.nethouseprices.co.uk

www.mouseprices.co.uk

Up My Street

www.upmystreet.com

A Guide to Moving or Buying your First Home - 26


Useful Contacts

Land Registry

HM Land Registry

www.landreg.gov.uk

Registers of Scotland

www.eservices.ros.gov.co.uk

Land Registers of Northern Ireland

www.irelandlandregistry.co.uk

Removals

The British Association of Removers

www.bar.co.uk

The National Guild of Removers and Storers

www.ngrs.co.uk

Solicitors & Conveyancers

The Law Society

England and Wales – www.lawsociety.org.uk

Scotland- www.lawscot.org.uk

Northern Ireland – www.lawsoc-ni.org

The Council for Licensed Conveyancers

www.conveyancer.org.uk

Research sites

Council Tax bandings

England and Wales – www.voa.cov.uk

Scotland- www.saa.gov.uk

Office for National Statistics

www.neighbourhood.statistics.gov.uk

Public Transport links

www.traveline.info

NHS Services

www.nhs.uk/servicedirectories

Environmental, flood and pollution risks

www.environment-agency.gov.uk/

homeandleisure/37793.aspx

School reports

www.ofsted.gov.uk

Mobile phone masts

www.sitefinder.ofcom.org.uk

Road developments

www.highways.gov.uk/roads

Surveyors

The Royal Institute of Chartered Surveyors

www.ricsfirms.com

www.surveyline.com

Independent Surveyors Association

www.surveyorsweb.co.uk

A Guide to Moving or Buying your First Home - 27

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