As Cork property solicitors, every day we meet clients planning to buy their first home. It’s a big step in life and an exciting time. Having said that, for someone taking the first step on the property ladder, there’s a lot to take in and a lot to do. To give you some guidance, we’ve set out a Step-By-Step guide to make the process a little less daunting.
Step 1: What’s my budget? How much can I afford?
Before you start looking at houses, you need to figure out your budget. This will depend on a number of factors including your savings, what you can afford to borrow and what monthly repayments you can afford.
Aside from the cost of your mortgage you need to allow for other costs associated with buying a house including legal fees, stamp duty, valuation fees, engineer’s fees and insurances.
You should shop around for the type of mortgage that suits you best. There are a wide variety of mortgages available and you should make sure you fully understand what’s on offer. It can be confusing! So make sure you ask the questions you need to ask so you know exactly what you’re getting. Remember you are the customer; you are the one that will be paying back this mortgage, so make sure you understand exactly what’s on offer.
Once your mortgage application has been successful, the bank will give you what’s known as “approval in principle.” This is a guide to how much the bank is willing to lend you. This gives you a better idea of your budget and what type of properties you can afford.
Throughout this step, it’s a good idea to touch base with your solicitor if you have any questions. There’s a lot to take in and you’ll come across a lot of banking and legal language you haven’t heard before. If you don’t understand something, ring your solicitor and ask her to explain it.
Step 2: Find your new home.
This is one of the most exciting parts of the process. Only you can decide which property will become “home.” Aside from your budget, you need to think about location – do you want to be close to family, friends, work? Do you prefer city living or would you rather look out the window at green fields? It’s a buyers’ market at the moment and this means for the first time buyer you have more choice and value for money than you would have had a few years ago.
Step 3: Making an offer and putting down your deposit
When you’ve found a house you want and can afford you make an offer and negotiate the price, usually through an auctioneer. Once you’ve agreed a price, you put down a deposit with the auctioneer. You should make sure this deposit is “subject to contract and title”. This means that if you don’t sign contracts, the deposit is fully refundable.
At this stage, you have a few things to get started on:
– You need to give the auctioneer the name and address of your solicitor. The auctioneer will then get in touch with the seller’s solicitor and ask them to send contracts to your solicitor.
– You should give your bank/mortgage advisor full details of the property and the name of your solicitor. The bank will then prepare the loan offer and post it out to your solicitor. At this stage you should also finalise all paperwork with the bank.
– You need to hire an engineer to carry out a survey of the property. Your solicitor may also give you more details on exactly what she wants the engineer to do aside from a structural survey of the property. This could include a planning search, checking the boundaries, checking rights of way etc.
– You need to arrange a valuation for the bank.
– You need to put in place your house insurance and life insurance.
Step 4: The legal process
The contracts and loan offer will be sent to your solicitor. Your solicitor’s job is to guide you through the legal process. This includes making sure you understand exactly what you’re buying and all of the obligations you have to the bank. Your solicitor carries out full investigation of the title to the property, requests your loan cheque from your bank and completes the purchase on your behalf. Your solicitor is there to ensure that all necessary registrations and legal work is completed to your satisfaction and in line with the bank’s requirements.
Step 5: Getting the keys
At last! Once you’ve got your keys, take time to celebrate! This is a big step in life and one that should be enjoyed.
By the time you get those keys, you’ll feel as if you’ve become an expert at navigating the home buyers’ market. But along the way, ask questions, get advice and make sure you understand exactly where you are each step of the way.
Taylor Solicitors Cork