Your first time buyer checklist

Hey there, budding homeowner! Struggling to navigate the first-time buying process? We know it can feel like stepping into a maze of unchartered territory, filled with puzzling jargon and endless paperwork. But it’s all good – Dodl’s got your back. 

Here’s your ultimate first-time home buyer checklist, packed with all the essential info you need to ace your home-buying journey. 🏡

1. Deposit 💰

A good place to start is by figuring out how much you need to save for that all-important deposit. First things first, dive into some research on house prices in the area you're eyeing. Once you've got a good grasp of the market, it's time to decide on the percentage deposit you want to aim for. 🎯

The bigger your deposit, the better the mortgage interest rate you'll generally get. Opting for a higher deposit percentage can really pay off in the long run, potentially saving you a lot of money over the lifetime of your mortgage.

Now, you might be feeling overwhelmed by the thought of stashing away all that cash? Fear not! Enter the hero of the hour – the lifetime ISA. Did you know you can give your savings a whopping 25% boost with this sweet account? 💸

To learn more, you can check out our article to find out whether a lifetime ISA is right for you.

2. Fees, fees, fees 💲

When it comes to buying a home, there's a whole bunch of charges and fees to wrap your head around. But fear not, we're here to break it down for you!

Let's start with the biggie – stamp duty. The amount you pay is kind of like a sliding scale depending on how much your property is worth. For homes up to £250,000, you're in the clear – no stamp duty for you! Then, it gradually increases with each price bracket, topping out at 12% for properties over £1.5 million. To learn more about stamp duty tax rates, check out the info provided by the government.

Now, if you're a first-time buyer eyeing up a home under £625,000, there's some good news. You'll get a nice little discount, meaning you pay no stamp duty on the first £425,000, and then 5% on the remaining chunk up to £625,000. So, if the house you’re buying costs £425,000 or less, you’re in the clear! Just keep in mind, this discount doesn't apply if you're splashing out on a place over £625,000. 🏘

Next up, mortgage fees. There's usually an arrangement fee and a valuation fee to cough up. And let's not forget about the solicitor or conveyancer’s costs – they're the ones doing all the legal legwork for your purchase. Oh, and don't overlook the survey and searches fees either – they can add up!

All of these fees vary depending on who you pick to do the work and what options you go for. For example, with a survey you could get the cheapest minimum one or a full belt-and-braces option that will cost much more. 💸

And finally, you’ve got the movers' fees, unless you're happy to channel your inner DIY enthusiast and tackling the move solo, that is.

3. Picking your professionals 💼

Alright, let's talk about assembling your dream team for buying a home! First up, you'll need a top-notch solicitor to handle all the legal stuff. They'll be the ones dealing with paperwork, making sure everything checks out with the property, and handling that pesky stamp duty bill (if the property costs more than £625k). 💷

When it comes to finding a solicitor, word of mouth is golden. Ask your friends and family for recommendations, and don't worry if they're not local – emails make distance a non-issue. Get quotes from a few to compare prices and scope out online reviews to make sure they're a good fit for you. 📜

Next on the list is a mortgage broker, if you decide to go that route. You can pay for one directly or opt for a free one whose commission comes from the lender. Again, personal recommendations and online reviews are your best pals here.

You've got options when it comes to brokers – from entirely online ones like Trussle to more traditional ones like L&C. While the estate agent may push their own choices, going independent is usually the smarter move. ♟

Last but not least, you'll want a surveyor. Depending on the age of the house and your level of worry about potential issues, you can choose the level of survey you want. Costs range from £500–£700 for a basic survey, to £800–£1,100 for a more thorough one.

So, there you have it – your A-team for navigating the home-buying process! 🏡

4. Mortgage option

The first steps are all about understanding your financial situation and figuring out how much you can borrow. Take some time to review your income, expenses, and credit history – all the fun stuff! 

Once you've got that sorted, it's time to explore the mortgage market and find the perfect fit for you. Don't worry if it feels a bit overwhelming; that's where mortgage advisors or brokers come in handy! Oh, and don't forget to gather all the necessary documents – think proof of income and ID – they'll come in handy when you're ready to apply. 📃

We hope that clears a few things up for you! If you think the lifetime ISA may be the account for you, get started today!

 

 

Open a Dodl account today

 

🔔 Just remember, LISA and tax rules apply, and as always, the value of your investments can go down as well as up.