GUEST POST: How You Can Cut Costs When Buying A New Home

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How You Can Cut Costs When Buying A New Home

Investing in a new property is a monumental and challenging task. After all, it means taking on a multi-decade financial commitment which may appear as a burden to some instead of as an investment. If you do not know where to get started, then you are in the right place as we will guide you on not only what you need to do but how you can actually save some quid when buying a house. 

Ready to get started?

Put Cash Away for a Deposit

It is imperative that you try to save a minimum of five percent of the value of the property. Usually, financial institutions demand that you put down a deposit tantamount to that sum. How do you get so much money together? Well, there are a few ways unless you already have some cash put away for a rainy day.

Cut back on your external recreational activities such as eating out, going to the movies and hitting the hottest spots in town on those Saturday nights. Start allocating a minimal sum on a monthly basis from your income towards saving for a deposit. Also, there is no harm in going back to your home base and asking your parents for some economic assistance. If it is possible for them, be sure to knock on those doors as those will be the friendliest ones you enter in this complex process. 

Check Your Credit Score

Study your credit history and evaluate your creditworthiness. Why, you ask? This will play a huge role in deciding the future terms and conditions of your mortgage loan agreement. You need to possess a strong credit rating before buying a house as you will not be able to secure a loan without it.

Compute What Your Budget Is

Before entering the property market blindly and falling in love with high end luxury homes, you will want to evaluate what you can afford to actually dish out. Browse some property loan websites and get a rough appraisal of how much you can actually gain in mortgage sum. 

Sure, you could be given a three hundred thousand pound mortgage. But that does not mean that is what you actually afford to pay from your current income. You will have to obtain an Agreement in Principle from a lender which will basically state that they are happy to lend you the money. Shop around for a bit and see who will give you the best deal. 

Hunt for Your Dream House

This is where the fun part begins – when you actually start looking for that perfect property. This is the place you imagine your life with your family with, raising your kids and growing old with your partner. You will want to keep in mind to register your details with local real estate agents to be aware of deals that come into the market beforehand. You can get amazing properties at bargain sale costs sometimes. 

Discuss with your spouse whether you’d like to go for a new property or a more traditional old school one that will need some renovation. You will have to keep extra cash apart to refurbish an older property. Anything could need replacing, perhaps a new boiler (Find out more), new pipes or the property may require some work on its plumbing.  The benefit here is that you can get such a property for a low cost and see if you have cash left over to perform the renovations.

Conveyancing and Surveys

Sure, you may be tempted to go for the conveyancing firm that your real estate agent recommends. However, you may be surprised to know that may be a more expensive option. Get a solicitor from out of town and you may enjoy better quoted rates. 

Do not get “Gazumped”

Interesting term, isn’t it? Gazumped. When your offer has been accepted by the seller for your dream property, tell him to take it off the market. You do not want to be side-lined at the last minute for a higher offer. Stay in regular touch with your lawyer to update yourself on the status of the buying process and to let him know that you’re on top of things as well from your end. Be ready to move fast and to chase!

Signing the Beautiful Contract

Once you make an offer and it is accepted, it could take an additional two to six weeks to actually get the logistics sorted that will permit you to go ahead with the signing of the contract. However, do not relax and try to push for the mutual exchange of contracts to take place as soon as possible. 

Remember that you can change your mind right before up to this point. However, you will not get any fees you spent back. 

Sell your Current House

The ideal scenario would be that you sell your house and sign over its ownership to the new owner at the same time as you obtain legal ownership of your new property. However, with so many parties and stakeholders involved – this may not be possible. Do keep in mind that if you sell first you will know how much money you have on hand to spend on a new home. Unfortunately, if you are not able to find something on time, you may end up renting till you do find the right place. The other risk is that if house prices go up, then your purchasing power will fall. However, it does not mean that you compromise on quality.

In order to save costs and to maximise your budget, we highly advise that you sell your current property first and then hunt for another one. 

Move in the Middle of the Week

If you intend to recruit a moving company to help you shift out, then remember to go for an entity that is registered under the British Association of Removers. To qualify as an element, they have to meet certain legal requirements, deposit protection and have proper licensed vehicles. Try to move into your new property in the middle of the week as you may enjoy better rates at that time. Remember you need to have enough time to pack up and move. You want to enjoy this process, not stress over it.

Best of luck!

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