Journey to Your Dream Home: Expert Guidance on the Home-Buying Process from Midlands Real Estate
Purchasing a home marks an exciting yet potentially challenging journey. Therefore, it’s crucial to prepare adequately before progressing on this path.
Explore the following advice and guidelines to facilitate your home-buying process.
For most individuals, acquiring a home involves taking out a mortgage.
Saving for the deposit Securing a home is a significant financial decision requiring extensive preparation. Before seeking a mortgage, several essential steps should be taken:
- Accumulating a deposit: The Central Bank allow lenders to offer up to 90% of a property’s value, given that the property does not exceed €220,000 and you’re a first-time buyer. For instance, if you aim to purchase a €200,000 house, your lender might provide up to €180,000, necessitating a 10% deposit of €20,000 which must come from you. If your buying a new build or a self build it would be worthy to note that several government initiatives exist to assist first-time buyers in entering the property market. These initiatives encompass programs such as the Help to Buy and First Home Shared Equity Scheme. Here you can read up on those scheme written by Midlands Real Estate.
Click here for more info on Taking Out A MortgageGetting Approval in Principle:
- Before selecting a property, it’s advisable to attain ‘approval in principle’ from your lender. This preliminary approval signifies that, based on your application details, the lender consents to a specified mortgage amount.
- Initiating the Mortgage Application Estate agents often possess valuable relationships with specific banks, making it worthwhile to inquire about potential referrals. Additionally, a strong financial track record and adept money management can bolster your mortgage application.
- Mortgage Protection Insurance Upon mortgage approval, securing mortgage protection insurance becomes pivotal. This insurance covers mortgage repayment in the event of the policyholder’s demise within the policy term. It’s advisable not to delay this process, as obtaining approval can take time, especially for individuals with previous health issues.
Start by viewing a few homes within your price range. Make a list of likes and dislikes for each property. Then, narrow down your list and revisit two or three favorites to decide. Remember, agents aim to sell, but a good agent will provide you with an in dept understanding of the property to help you with your decision. Well-priced homes don’t stay on the market for long, and there’s only one lucky buyer so you will need to act fast!
Engaging a Solicitor
Simultaneously, consider hiring a solicitor to oversee ‘conveyancing’—the legal process of property ownership transfer. It’s prudent to select a solicitor before or during actively pursuing properties to expedite the process once an offer is accepted.
Making an Offer and Closing the Deal
After choosing your desired property, presenting an offer to the seller is the subsequent step. Ensure clear communication with the estate agent about the offer details, including items included in the sale. Once the offer is accepted, the process moves towards ‘sale agreed,’ wherein a booking deposit is typically required.
Final Steps Toward Ownership
Upon acceptance of your offer, it’s crucial to promptly notify your lender. They’ll request property specifics like address, type, and age. Following a valuation survey and the lender’s contentment with the valuer’s reports, they’ll approve the loan for that specific property, specifying:
- Mortgage details encompassing value, duration, costs, and repayment schedule
- Property address and description
- Applicable terms and conditions
For older properties, your lender might require a surveyor’s report before issuing the offer letter. Subsequently, your bank will forward the letter of offer and associated legal documents to your solicitor. It’s advisable to meet your solicitor promptly after receiving the letter of offer to progress with the necessary steps.
Signing Contracts
The vendor’s solicitor will send out contracts and copy title documents to your solicitor. Your solicitor will then read these contracts and investigate the title to the property. They will raise what are called pre-contract queries and the vendor’s solicitors will reply. When you have your mortgage in place and your engineer is satisfied with the property and your solicitor is satisfied with the title, you will sign the contracts in duplicate
You will need to arrange an appointment with your solicitor, with a view to signing the contract. Once your solicitor is satisfied that the title to the property you propose purchasing is in order and that you are in a position to comply with all conditions in your loan offer, you should be in a position to sign contracts and pay the balance of the deposit which is normally 10% of the purchase price, minus any booking deposit you may have paid to the estate agent.
Your solicitor will keep one copy of the documents and the other will be sent to the vendor’s solicitor with the balance of the deposit. This deposit is now non-refundable. You will also sign the mortgage documentation for the bank if relevant at this point. The contracts are exchanged, and at this point you will have a binding contract to purchase the house.
Closing the Sale
On the exchange of contracts, your solicitor will raise what is referred to as Requisitions on Title which is a set of queries dealing with the property you propose purchasing. The vendor’s solicitor will then reply to these. Once your solicitor confirms that all documents are in order and there are no matters appearing on any searches which give rise to concern, arrangements will be then made, to complete the purchase of the property.
Once a closing date is agreed, your solicitor will arrange to draw down your loan cheque from your bank or lending institution.
After the contracts have been exchanged, your solicitor will draft the transfer deed which transfers the title from the vendor to you. The draft transfer deed is sent to the vendor’s solicitor who arranges for the deed to be signed by the vendors. Your solicitor will now draw down the mortgage (if necessary) and will advise you on closing balance, along with stamp duty, professional fees and other outlay.
On the day of the closing both solicitors meet. Your solicitor will either electronically transfer the balance funds or hand over a draft for the balance funds in return for the signed transfer deed and the title documents. You will now also receive the keys to your new home! The house is now legally yours but your solicitor still has work to do..
Property Tax – Stamp Duty
Stamp duty is the tax you have to pay when you buy a property. Since December 2010, the rate is 1% for properties valued up to €1 million, and 2% for any amount above that. Your solicitor will sort out paying the stamp duty for you, but just be sure you’ve got the money ready to hand over to your solicitor when they’re closing the sale.
Collect Your Keys
Once the money’s sorted and sent to the seller before the agreed closing date, the estate agent will ring you up. They’ll confirm everything’s set for closing and remind the seller about the date and time. When the estate agent says the keys are good to go, the property’s officially yours. That means the seller should’ve vacated and taken out anything not part of the sale. Now it’s up to you to ensure the place is safe and secure, even if you’re not moving in right away.
At Midlands Real Estate we are happy to get in touch with you if you need guidance while on your journey to acquiring your forever home. Get in touch!
