Many first time buyers believe that the only cost of buying a house is the cost of the property. Although this is the most significant cost, there are other fees that have to be considered, as they can add up to thousands.
A lender will charge an arrangement fee for sorting out your mortgage, which is often between £1,000 and £1,500, although banks differ greatly. Legal fees have to be paid, often around £1,000, depending which services are needed from your solicitor. When you find the house of your dreams, the bank wants to know that the property is worth the amount you are borrowing, so a valuation and survey will be required. There are various types of survey available, from a basic check to a comprehensive survey that will include structural details. The cost of this can be anything from £150 to £1,500.
A solicitor will usually conduct searches with the local council to make sure there aren’t any issues that could affect the value of the property, including planning or other issues. If a property is more than £125,000 you will also have to pay Stamp Duty, which is payable at varying rates depending on the purchase price. For a home between £125,001 and £250,000 the percentage payable will be two per cent.
There are many costs associated with buying your first home. Consult with a mortgage adviser who has taken a CeMAP Course, so that they can guide you through the first time buying process.
