It can be scary to buy a house. It’s one thing to deal with a lot of money, but people often forget how much paperwork is involved. From getting a mortgage to moving in, we take care of everything. Look at this more closely.
Mortgage paperwork for your lender
If you require to be taken seriously as a buyer, you should start your mortgage application or at least have an agreement in principle. Before you talk to real estate agents, do this. Order a copy of your credit report to get the ball rolling and increase your chances of getting a mortgage.
Before you talk to lenders, try to solve any problems as best you can. After you’ve done this, you can start getting the papers you’ll need. Each broker is different, but the following are some of the most common things you’ll need:
- Not online printouts of your utility bills, but hard copies or copies certified by your lawyer.
- Your latest P60 form
- Your pay stubs from the final 3 months
- Passport or license to drive (for proof of identity)
- Statements from your bank for the last three months or certified accounts for the last three years if you are self-employed.
- If you are self-employed, your SA302 form (the HMRC can take a long time to send this, so plan!)
When you apply for a mortgage, be honest. If you don’t want to wait, ensure that the data on the forms matches the information on the documents you give.
Putting up your outgoings
Lenders have to give you a “stress test” to see if you could still make payments if something went wrong. For example, if you had kids or if interest rates went up. To get a mortgage, you’ll need a lot of things. You will have to show all your expenses, like credit cards and other lending, as well as your household bills.
- Bills for utilities
- The Council Tax
- Insurance Policies
- Costs of living, like transportation, child care, and entertainment
This helps a lender decide whether or not they want to lend you money.
Documents needed to hire a solicitor.
You may also want to hire a lawyer or real estate agent to complete the first paperwork. This means they can move on to more important things once they find a home. Know Your Client, or KYC is a process that lawyers use to check up on you. As a new client, you must prove who you are because of government rules. Most UK residents will use one of the very next original documents to prove who they are:
Full or temporary UK photo driving license P60 or P45 Police or other government ID card UK ID card for the armed services
You will require proof of where you live. Here are some typical ones:
- Statement from a bank or building society Tax bill from the council UK driver’s license
- Electoral register Self-assessment declaration or tax demand from the Inland Revenue
- Recent bill for utilities
You can’t use the same document twice, so on each list, pick something different.
What you require to do to create an offer
When trying to make an offer on the house, you can do it in person or over the phone with the real estate agent. But if you send the owner a written offer, you have a great chance to sell yourself. If other people are interested, you should do whatever you can to stand out. You might want to include some of these in your offer. By law, real estate agents must pass on all offers, but it never hurts to remind them:
- Information about your mortgage offer that shows you can pay the price you’re offering
- Let them know if you’re not part of a chain. This makes it more likely that the deal will go through. Please give them a choice of moving dates.
- Please include the names of your lawyer and surveyor to show that they are already set up.
- Lastly, include moral reasons that fit your situation, even though it may not help. For instance, if it’s a much-loved family home, you could say that you could see your own family living there. It might make you step out from the other people.
You can write a letter or send an email with your offer. Just make sure the agent or seller doesn’t have a preference first.
Surveyor’s report on the property
Once your deal has been accepted, you should take a close look at the property and complete a survey. Your lender will do a valuation survey, but that’s to make sure the property is in good shape for lending. Getting your survey can help you avoid unpleasant surprises and give you peace of mind that the house is built well.
There are various kinds of surveys:
- RICS condition report – no advice or valuation included with this
- RICS homebuyer report – includes a valuation
- Structural survey – you get advice and an estimate of the value
If the survey finds major problems, you can ask that those costs be removed from the asking price. For instance, if the roof needs work worth £10,000, your offer could show this. Even if there aren’t any big problems, it’s a good idea to keep this document as a reminder of what might need to be fixed once you move in.
Make sure you are covered at the exchange.
At the exchange, you’ll be in charge of the property, so you’ll need building insurance. Send your lawyer a copy of the information about your policy so they can keep track of it. This is also a great time to check your contents insurance to make sure it covers your things while they are in transit and to let your insurance company know where you are going.
Documentation after completion
After you finish building your home, there are a few papers you’ll want to gather and put somewhere safe. The title report from your lawyer is very helpful. It has a summary of the legal title and the results of a property search. It should also have a form with information about the seller’s property, like where the water stopcock and meters are.
You should get a copy of the NHBC new apartment warranty or something similar for homes less than 10 years old. During the warranty period, you can claim if something goes wrong. If you have added on or done renovations, ensure you have the development control certificates showing the work was done correctly and signed off.
Ask the seller if some of this paperwork wasn’t given to your lawyer by the seller. Maintaining a positive relationship with them may help in this situation. Your lawyer will also inform you in writing that the sales tax has been paid within 30 days of the closing.
They will provide you with a copy of the title document after a few months. If it is leasehold, they will also include a copy of the rental agreement and service charge accounts. Keeping all these papers together will help you take good care of your new home and make it easier to sell if you ever decide to.