Buying a House – Exchange and Completion

This is the 4th and final part in my house buying series and follows on from ‘Solicitors and Surveys’. Once all the paperwork is complete you are now ready to exchange contracts. Once you have exchanged you are legally bound to buying the house and the seller legally has to sell it to you. You cannot pull out of this without incurring major costs and potentially losing your deposit. We exchanged 14 weeks after putting in our offer but I have no idea what the average timescale is, it will vary greatly depending on your chain and circumstances.

The Exchange process involves handing over the money for your deposit, any remaining fees and stamp duty to your solicitors. It was scary transferring that much money at once, I was so worried it would somehow get lost on route. Once the solicitor receives the funds and everyone else in the chain has done the same then you are ready to exchange. As soon as this was done we then needed to set up buildings insurance straight away as we were then responsible for the building and committed to buying the house. This then had to be approved by the solicitors to ensure it met the requirements of the lender.

We had no idea when we were going to exchange, all of my friends seemed to have a date well in advance yet we paid all of this money and didn’t have a clue. The solicitors were very vague with us and wouldn’t give us anything concrete. They wanted us to set up buildings insurance from the date of exchange yet wouldn’t give me a date so we went around in circles for a bit. After telling us ‘exchange was just around the corner’ we then had is sprung on us that we were in fact in a chain. We then knew it was going to take forever, this really did get me down and I kept trying to think of the positives. The longer it dragged on the more money I had in the bank for furniture and other house related items.

When you exchange you should then get a completion date. Our date was 12 days later but this can happen within a week or even a matter of days. We were pleased we had a bit of extra time as we hadn’t really started packing. Those 12 days were the longest days EVER. I just wanted the keys in my hand. Completion day is the most exciting part.. the day you get your keys! I will write all about my experience with moving in my next post.

I really hope this series has helped you or at least given you a rough idea on what it’s like to buy a house for the first time! If you have any questions please feel free to use the ‘Contact’ page and drop me an email.

Helpful House Buying Links:

Where to Start 

Putting in an Offer

Solicitors and Surveys

Buying a House – Solicitors and Surveys

This post follows on from my ‘Putting in an Offer’ post and is part 3 in the series of buying a house. The next step once our offer was accepted on the house was to fully apply for the mortgage. We instructed a solicitor who was happy to act on our behalf and we gave the estate agent their details. Once applying for the mortgage via our financial adviser we had to pay for a survey. We weren’t expecting to have to pay for this so soon and the funds weren’t in place so we had to take some out of our deposit with a view of paying this back before everything was completed. I was so worried at this stage. When money gets involved it feels more real and if it all went wrong then we would be out of pocket with nothing to show for it.

There are a few different types of survey and this will all be explained to you when the time comes. We went for a Homebuyers Survey which cost £200 but this will vary per lender. The survey was booked for 2 weeks after applying for the mortgage. You will probably feel like you’re in limbo at this point. We also knew our seller hadn’t found a house so the chain hadn’t even been set up and we were already paying for things which worried me. I had no idea what was meant to happen next or what we needed to do. I spent hours on google and read hundreds of horror stories.

Before our survey took place I was told I was potentially being made redundant from work. All my hopes and dreams were shattered. If I was made redundant then our mortgage application and offer would have been withdrawn. Even if I found another job there was no guarantee I would be on the same wage meaning the amount we could borrow would reduce and we would lose the house. Of all the things that I had researched that could go wrong, this was not something I expected and made all the other horror stories seem trivial. We continued as normal hoping and praying we would complete before my impending doom. I knew if we could just get the house then we would be fine and we would be able to run it from James’ wage until I found another job. The survey took place and the mortgage lenders sent us a text saying they were reviewing the valuation report. In the meantime the seller found a vacant property which meant we had no chain – hurrah! We hoped this would speed things along. The estate agents needed to send over a Memorandum of Sale to the solicitors which they still hadn’t done so we chased that up and awaited the survey results. Thankfully I kept my job too if you were wondering!

The day after our survey took place we were told that the mortgage offer had been issued and we awaited this to arrive by post and hoped that it matched the amount we wanted to borrow. This was then re-issued due to a spelling error with my surname! Trust me to have an awkward name!

We then received our welcome pack from the solicitors which outlined all of their fees and asked for us to pay for the searches as soon as possible. I wanted to get things moving so I sent the payment straight away and filled out all of the forms required which proved we had the deposit, insurance and some information on our identity. They also asked for our ‘desired completion date’ so we went as early as we could – 6 weeks into the future so we could get in ASAP if possible! The next day we popped into the Solicitors office to prove our identity physically to avoid any further delays. We were told the searches could take up to 6 weeks because they relied on the local council to get the results back to them. This actually took around 3 weeks in the end.

The next stage involved waiting for the sellers solicitor to send over a draft contract. We chased the estate agent for this and when we found out it had been sent we then chased our solicitor. So much of the house buying process is just chase chase chase! In the meantime we received the results from the survey. There were some things that were classed as ‘level 3’ which need immediate attention. These included gas, electrics and heating but we were advised that these will always be flagged up as the surveyor cannot physically test them and generally people don’t have the safety certificates as it’s not a legal requirement unless the house is a rental. There was also mention of the property not having any mains powered smoke alarms. Most houses I have been in do not have these, just battery powered ones so we weren’t too concerned with this point. There was nothing on there that made us feel any different about the house and none of it devalued it.

We received some documents in the post and the searches were started. The documents consisted of all of the fixtures and fittings that the seller is leaving. Some people will even take the lightbulbs with them! We were really lucky in that our seller left us the washing machine, fridge, freezer, oven, mirrors and even garden furniture. We plan to replace these items eventually but the initial expense this saved us was fantastic and after a good clean they would definitely do the job.

The water searches came back after 2 days but the local ones took longer and came back after roughly 3 weeks and we then had to wait for the solicitor to prepare their final report on all of the findings of the searches and the contract information ready for exchange. When we received this report it detailed the final balance payable to complete and lots of information about the house. It was interesting to see what had been going on behind the scenes, the solicitors had even arranged for the seller to have the boiler serviced which was handy!

We wanted to exchange as soon as possible so we signed the contracts, the mortgage deed and settled the funds the next day. All that was left to do was to exchange and complete….

Buying a House – Putting in an Offer

This post follows on from my ‘Where to Start’ post and is the second in the series. I hope this helps you if you are currently looking to buy a house yourself! After viewing multiple houses as I spoke about in my last post we were ready to make an offer. It took us nearly 4 months to find somewhere after around 7 different house viewings between us. Any houses we liked the look of we arranged to view them through the relevant estate agents. When we found one we REALLY liked, we emailed a link across to the adviser for him to check and see if he agreed with the asking prices and what the maximum he thought we could afford to offer.  He then gave us a decision in principle which is valid for 90 days so we could go back to the Estate Agents with an offer. This was daunting, our adviser was very helpful with explaining step by step what needed to happen (if you’re from Norwich and you’re looking for someone, drop me an email!).

When it comes to putting in an offer – be wary about sneaky Estate Agent tactics. We viewed a property that had been on the market for a good few months and suddenly when we showed interest the estate agent told us they’d “received an offer”. Whether this was true or not is hard to say. I personally think they only said this to gauge how high we would be willing to go and what our budget was. It is likely your first offer will be declined. As Kirsty and Phil say, if you’re not embarrassed by your first offer then it’s not low enough! Many houses are priced 5%-10% higher than they are worth in order to allow for people to offer under the asking price. I believe that you shouldn’t want your first offer accepted as it means you could have tried to go in lower! Bear in mind you may make offers on multiple houses before you find “the one”. Stick to your top budget and be prepared to walk away if you get out-bid. The right house is out there waiting.

The first offer we made on a house was around 6% lower than the asking price. We would have went lower but we were told the offers were between us and another couple and the highest one would win. I still don’t know if this was a tactic or the truth but the mystery offer was never heard of again after we put ours in. With that in mind we went at what we thought it was worth and within our budget. We called the estate agent with the offer and he said he would pass it onto the seller. It took a good 2 weeks of to-ing and fro-ing with the seller, the estate agent and us before we finally got an answer that our offer was accepted. We were congratulated by the estate agent and we were told to get the ball rolling with the next steps. 5 minutes later they called again to say the seller wanted more money and had changed their mind so we decided to walk away, we didn’t want to pay any more. The estate agent said in all of his years of doing the job he has never had someone change their mind so quickly after having 2 weeks to think about it. At the end of the day we were the only offer and if they’d rather have no money than less money then I think it’s their loss! Over a year later it is STILL sat on the market – where was the other mysterious offer they had on it then? I was just pleased we hadn’t spent money on expensive surveys before they changed their mind. I believe everything happens for a reason.

The next house we found was even better and we were more cautious with the offer as we didn’t want to lose it. We offered 7k under asking price. They then came back with a counter offer which we agreed and it was accepted, 4k off the asking. We didn’t want to lose the house or negotiate further so we went with our gut and what we were happy to pay. All of this took place within a couple of hours, a lot less time than the first house. As soon as we saw this house I knew it was the right one and I was so pleased that we didn’t get the other one. I could really picture myself being there but had to hold back because so much can still go wrong.

After your offer has been accepted it is possible that someone can come in with a higher offer. This is called “Gazumping”. As soon as your offer has been accepted, put it in writing and ask the estate agents and the seller to take it off the market. This will reduce the chances of your offer being beaten. Things can still go wrong at this stage. Just because your offer has been accepted doesn’t mean the house is yours! You can lose it right up until the exchange date. There is still a long way to go.

The next stage is get a solicitor in place. Our financial adviser kindly arranged this for us and we moved onto the next step…

Buying a House - Where to Start?

Buying a house is one of the biggest financial commitments that you can make, and one that I am currently in the process of going through myself. There are loads of additional costs when buying a house that you may not have thought about or even budgeted for. It’s not as simple as just paying a 5 or 10% deposit on a house, there are also a number of fees involved. I’ll be posting even more tips and tricks over the coming months and hopefully it will help at least one person so please keep an eye out for those here on my  blog.

The first stage we went through was to get a financial adviser to see if we could get a mortgage. After doing this process a lot of people said “you could have just gone to the bank” but an adviser can search across multiple rates in the market and get the best deal. Yes you will have to pay a fee but for me this was worth doing as it saved me a lot of time and he was there to answer any questions at the drop of a hat. An independent financial adviser is also qualified to give you advice, they know what they are talking about. They can provide advice on the very best products tailored just for your needs.

I’ll be honest by this stage I was scared. I had no idea if we could borrow enough to get our home or if we would have to settle for a tiny one bedroom apartment. I worried that after our mortgage and bills that there would be no disposable income left for emergencies, birthday presents or spontaneous social events. I worried our bank accounts would be drained with hidden fees and we would never be able to afford furniture or decorating supplies. How will I ever afford to get married, go on holiday or have a life? My mind was running wild. I had no idea how much bills cost so could only assume rough amounts based on the internet. I felt like I had no one to talk to as most of my friends have already moved out and no one else was in the same situation as me. No one likes to actually talk about how much they’re paying out either so I had nothing to compare to.

The deals that the financial adviser could give us were exclusive and could not be bought on the high street and we could borrow a lot more than expected, plenty for the property we were after. As soon as we left our meeting with the rough figures in our head, we started our house hunt by looking on Rightmove, Primelocation, Zoopla and various other estate agent websites. We gave our details to every Estate Agent in Norwich and our criteria and awaited the emails and calls to come through. This was really difficult. We’d see a house we liked, by the time we had thought about it, it was sold. The websites were not updated as fast as the houses were selling and we really needed to get our butts in gear and start booking in some viewings. I did wonder how on earth we would view a house when we both work 9-5 and I also work most weekends.

I used the Cost of Moving Calculator from the reallymoving website which really helped me start to put aside some funds to afford the fees. reallymoving was launched in 1999 and is the UK’s leading provider of instant quotes for home moving services. They can provide you instant quotes for conveyancing, surveys and removals. If you want to find out how much it will cost you to move home, head over to the Cost of Moving Calculator. This calculator is simple to use and you can choose buying, selling or buying and selling as an option.

We had previously been quoted £1200 for conveyancing and a survey but on reallymoving I was quoted just £600 – that’s a saving of 50%! You can then click for quotes for particular aspects. I clicked the conveyancing quotes and filled in all of the information about the property I am purchasing. I then had the option to be sent some quotes from local firms which was really handy. It also calculates your stamp duty cost and a rough estimate on how much a removal service will be. I found the calculator to be very useful and I wish I had known about it sooner in order to really save some money. I would definitely recommend using the calculator to get a rough idea on the costs so you know how much extra to allow for.

The first house we viewed was the next road across from where I live now and I really liked it. I think it was easy to like the first one I saw because it was the first time I really pictured myself moving out and it got me excited and I wasn’t able to see the flaws like the lack of parking. We continued to view houses, not really knowing what questions to ask or what exactly we were looking for. Thankfully people do let you view their houses after work and on the weekends so we could easily fit these into our schedule. You need to be prepared for heartbreak, you may see a house that you like online and it’s not what it seems in real life. You may also start picturing how everything is going to be decorated and how you’re going to set each room out and find out that someone has put in an offer more than you can afford. Its stressful, you will more than likely argue, you will feel like you’re making no progress at all. Try not to get your heart set on anything because until those contracts are exchanged anything could go wrong! It’s only bricks and mortar after all..

Have you recently moved house? Stay tuned for my next post on how to put in an offer on a property and what to expect.