Buying a home is probably the biggest financial decision you'll make in your life. Whilst very exciting, there's much to consider and the legal work involved may seem a little daunting.  

Once you've found your new home, which can take anything from a few days to a few months, having your offer accepted to completion can take up to 12 weeks in the UK, this is about as twice as long as many other countries. 

Hopefully this guide will help with what can be a lengthy and complicated process in buying your first home ... 

How much can you afford?

What payment costs do you incur as a first-time buyer? The first thing to consider is how much of a deposit is required. You will also have to make some one-off payments including:

• Legal Cover
• Evaluation searches
• Solicitor's fee
• Mortgage arrangement fees
• Stamp Duty - dependent on how much the property is sold for:

• Bills (council tax, gas, electricity, water, telephone, TV Licence, broadband)
• Mortgage repayments
• Insurance (Life cover, buildings, contents)
• Food/toiletries
• Car/transport costs
• Ground Rent/Maintenance (for flat owners)
• Pension/Savings
• Money for clothes/socialising/gym membership etc

The Home Information Pack (Hip) may give an idea of the household bills and council tax etc. 

How much can you borrow?

Using traditional income multiples, the amount you can borrow is 2.5 x times a single salary or if you're buying with someone else it's up to 3.5 x joint salaries.

However, in view of the increased cost of buying a home, mortgage lenders will let you borrow more than this. The "affordabilty criteria" that lenders use will take into account your monthly outgoings and assess what remains to make your mortgage payments.

Contact a mortgage advisor to find out how much you can borrow and what terms are available - you will be surprised at the variety of mortgages available.

Conveyancing Solicitors & Legals

A property solicitor or lawyer will need to be appointed to deal with the conveyancing and legal formalities of the property transfer.  

The fee will either be a percentage of the value of the property or a fixed amount. Obtain quotes and seek personal recommendations.

Following the acceptance of a formal offer on the property you're buying, your solicitor will process the legalities as follows:

• Pre-sale enquiries between you and the vendor
• Local searches
• Exchange of contracts with the vendor (usually a week before the "completion date" or "moving day")
  A mortgage offer will need to be in place at this time
• Point of Completion
  - the Land Agency will register your name
  - the stamp duty will be paid
  - payment of telegraphic fees for transfer of monies from one account to another will be made

Surveyors & Surveys

Your mortgage company or lender will probably carry out a survey on the property you're buying, unless you are putting down a very large deposit. It's called a "valuation" and it's purpose is to verify the property is adequate security for the amount you are borrowing.

You can arrange to commission your own survey (Homebuyers) which can offer peace of mind, as it will make you aware of any problems such as subsidence, dry rot or damp. This can be used as a "bargaining tool" should you wish to negotiate the amount offered.

The Home Information Pack (Hips) introduced on 1 August 2007 may include a "home condition report" outlining problem areas, but it's an optional document currently. The Hip only applies to 4 bedroom homes at present, but should include all property types by the end of 2007. 

Property Insurance

You'll need to protect your home by insuring the building against damage, such as flooding, fire or subsidence. This will be insisted upon by your mortgage lender.

In addition, ensure that you have adequate insurance cover for house contents.

Get some quotes from a selection of insurance companies, some will offer to cover both buildings and contents. 

Utilities

Find out the firms that have supplied electricity, gas, water and telephone to the property and make them aware the meters need to be read on the "completion date" and you'll be responsible for them from that time. Your vendor will probably have given instructions too.

Do some research into what companies are offering the most competitive rates.

Moving in ...

Be prepared! Our Guide to Moving will give you lots of useful tips for a hassle free move! Good luck!