A Guide To Buying Your First Home

Reasons to choose Wilson Browne

The first step onto the property ladder is often an exciting time for many people, of any age, but a time that can often come with some stress and perhaps a little fear of the unknown.

Buying a property is likely to be the most important transaction in someone’s lifetime, so it’s imperative to have an idea of what to expect when you put in an offer on your first home!

Our comprehensive First Time Buyers guide aims to cover all you need to know when buying your first home.

Consider any Government Schemes that may benefit you. Schemes include the Lifetime ISA or a shared ownership scheme. If you are utilising the Lifetime ISA or Help to Buy ISA (note this must be existing as new accounts can no longer be opened) you can obtain government bonuses from both, subject to satisfying the relevant criteria.

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The property – Freehold or Leasehold

Freehold or Leasehold – there are significant differences between the two, consider:

Freehold Ownership:

You own the building as well as the land it stands on
No ground rent is payable
Freedom over the use, improvements and additions to the Property (subject to planning)
Property owners are solely responsible for maintaining the interior and exterior of their home and external grounds
Property owners arrange their own buildings and contents insurance
Estate charge is sometimes payable for the upkeep of shared amenities in the estate
No restrictions on future sale of the Property

Leasehold Ownership:

The building and the land it stands on are owned by the freeholder
You will own the right to live in the Property for a set number of years, subject to certain conditions
You may have to pay ground rent to the landlord, depending on the Lease
Property’s use, improvements and additions restricted by the terms of the Lease and subject to permission from the landlord
The landlord is responsible for maintaining the common parts, main structure and external grounds
You will pay service charge for the repairs and maintenance
You will be responsible for maintaining your Property internally and to pay for your own use of utilities

Offer accepted – what now?

If you haven’t already, contact your mortgage adviser to make the full application to your lender.
Survey – It is always recommended to instruct a surveyor to carry out a survey, in addition to that provided by your mortgage lender, who is usually just interested in the valuation. There are many different types of survey you can consider, the cost and what each will reveal will differ. A survey can reveal many issues that may be costly to resolve in the future, so it is a good idea to obtain this prior to your commitment to the purchase.
Appoint your conveyancer – take care to shop around and remember the cheapest is not always the best. Many seemingly low quotes start to creep up as the extras get added on. Speak to your estate agent, or family and friends to obtain their recommendations.

The conveyancing process may seem a little overwhelming, but your conveyancer is on hand to assist you with any questions you have.

Your conveyancer will carry out the necessary legal checks on the property – how long this will take will depend upon the circumstances of your transaction and whether you are in a chain of transactions. The average timescale is 8-12 weeks from instruction to completion, but remember, it isn’t an overnight process, so it’s important to be patient. Try not to compare the length of your transaction to your friends and family. Your circumstances and property are completely individual to you.

Remember that at the end of it, you’ll be collecting the keys to your dream home – it is your conveyancer’s job to ensure you are obtaining a good and marketable title on behalf of you and your mortgage lender.

Paperwork

There will be a lot of paperwork – this is how your conveyancer obtains your specific instructions, and enables them to take account of your individual circumstances and requirements. Make sure you read each document carefully, if you need help, ask your conveyancer, they will be happy to assist you.

ID/ Source of funds

You will be asked to provide evidence of your ID to your conveyancer who are likely to carry out a search to confirm your identity. You will also be asked to provide evidence to your conveyancer of the source of your funds, for example copy bank statements and to identify how these have been accumulated. This is a compliance requirement and dealing with this at an early stage will avoid delays with your transaction. Be sure to have this paperwork ready.

Searches

As part of their investigation of title, your conveyancer will carry out searches. These include a local search (which reveals, amongst other things, planning and building regulation matters, details of roads serving the property and any proposed road or railway schemes), an environmental search (of increasing importance now and will identify issues such as contaminated land and flood risk), and a water and drainage search. Depending upon the location of your property, additional searches may be required. You can expect to be asked to pay money on account to cover the cost of the searches and other services paid out initially by your conveyancer.

Report

Your conveyancer will send to you a report on title in respect of the property to include its title, the results of searches and information provided by the sellers. Take care to read this report carefully along with the accompanying paperwork. Your conveyancer will also send to you the contract and any other relevant paperwork to sign at this stage, if they haven’t done so already.

Ownership

If you are purchasing jointly with another party, your conveyancer will ask you how you wish to hold the property between you, as joint tenants or tenants in common.

There are legal differences between the two so take care to discuss this in detail with your conveyancer to ensure that your decision reflects your specific circumstances.

How you fund your purchase will of course be personal to you, but consider:

A mortgage

Most people require the assistance of a mortgage to purchase their first home. A mortgage adviser can assist you with making your application.

Your conveyancer will receive a copy of your mortgage offer, report to you on it and arrange for you to sign the relevant documentation.

Gifted deposits

Be sure to tell your conveyancer at the outset if you are receiving a gifted deposit. Additional steps will need to be taken and dealing with this at an early stage will avoid delays later.

Savings

Chances are you will have been saving hard for your deposit. It is imperative that you have access to your money in readiness for exchange and completion.

Exchange of contacts

Exchange of contracts is the point at which the transaction becomes legally binding. It is unlikely you will be able to withdraw from the transaction at this stage without incurring significant financial penalties. Your conveyancer will notify you once they are ready to exchange contracts and request your deposit. The deposit is usually 10% of the purchase price.

The agreed completion date will be inserted into the contract and the parties will be bound by it. Once exchange has taken place, you can start packing and arranging your removals. It is not advised to do this until actual exchange has taken place as the date may change.

You also need to put on risk your buildings insurance at this point as the property is at the risk of the buyer from exchange of contracts.

Immediately prior to exchange of contracts, it is a good idea to carry out a final physical inspection of the property to ensure you are happy with the condition of it and that nothing has changed.

Completion

Prior to completion you will receive a completion statement from your conveyancer. This will detail the financial elements of the transaction and detail the balance due from you. Ensure you arrange to transfer this to your conveyancer in good time for completion.

On the day of completion, your conveyancer will transfer the balance due to the seller’s conveyancer – once received, they will confirm completion and arrange for the keys to be released by the seller or their estate agents.

Buying your first home is an exciting time, as long as you have someone to take away the stress and uncertainty.

We are recognised as experts and approved by lenders and developers. There is a wealth of information on our website to help you and various guides

First home scheme

What is it?

A Government-backed Scheme launched in April 2021 to help first time buyers purchase their first home.

Eligibility Criteria

Must be 18 or older
Must be a First Time Buyer
Able to get a mortgage for at least half the price of the home
Buying a home as a part of a household where the total income is no more than £80.000 (or £90,000 if in London).

The Local Authority may also set their own eligibility conditions for example: essential workers and those who already live in the area.

How does the First Homes Scheme work?

The Scheme allows developers to select properties to be offered to first-time buyers at a discount of up to 50% of the market value (most commonly 30% of the market value).

The following conditions apply:

Every home under the Scheme is valued by an independent surveyor to make sure that the discount is being applied to the full market value.
The initial sale price of the home cannot be more than £250,000 outside London and £420,000 inside London after the discount has been applied.
The Scheme applies to properties in England only.
It must be your only and main residence for the duration of your ownership. You are allowed to let out the property for up to 2 years in total, note approval from your mortgage Lender and local authority is required.
Lodgers are allowed, but only if the property remains your only and main residence.
You can only then sell your home to another first time buyer, however the same discount to the full market value must be applied. Bear in mind this is based at the full market value at the time of the sale. The Local Authority must also approve the eligible buyer.
The discount on the property will apply forever, meaning generations of local buyer’s will benefit from the reduced price on the property.

How do you apply?

Once you have chosen your new build home with the developer, they will assist you in completing the application to send to the Local Authority.

The Local Authority will have to approve you as a buyer using the eligibility criteria. If approved, the Local Authority will issue an Authority to Proceed and Eligibility Approval which will be valid for 3 months from the date of issue. Contracts must be exchanged on your purchase within this period.

Next steps

Once the purchase has been agreed with the developer and the local authority have approved you as an eligible First Homes Scheme buyer, you can now apply for your mortgage and instruct your conveyancer.
Your conveyancer will receive what is called a ‘Conveyancer Pack’ from the Local Authority directly with all the information they require on the First Homes Scheme. Your conveyancer will contact you regarding this throughout the transaction.

Finally

A First Homes restriction will be added to the Title Register of your property upon registration of your ownership at the Land Registry. This will stay on the title forever. This allows the property to be sold to another eligible buyer in the future.

Frequently Asked Questions (FAQs)

What is considered a first time buyer?

A first time buyer is generally someone who has never previously owned a property or held a legal interest in a residential property, either in the UK or abroad.

How much deposit do I need to buy my first home?

The amount required will depend on the lender and the property value, but many first time buyers provide a deposit of between 5% and 20% of the purchase price.

What additional costs should I budget for when buying a property?

In addition to the purchase price, buyers should also consider costs such as:

Solicitors’ fees
Survey fees
Mortgage arrangement fees
Stamp Duty Land Tax (if applicable)
Removal costs
Search fees
Land Registry fees

What does a conveyancing solicitor do?

A conveyancing solicitor deals with the legal aspects of buying a property, including reviewing contracts, carrying out searches, liaising with the mortgage lender and transferring ownership of the property.

What are property searches?

Searches are enquiries carried out with various authorities to identify issues which may affect the property. Common searches include:

Local authority searches
Drainage and water searches
Environmental searches
Flood risk searches

Do I need a survey when buying a property?

Although not legally required, a survey is strongly recommended to identify any structural issues or defects before you commit to the purchase.

What is the difference between exchange and comple

Exchange of contracts is the stage where the agreement becomes legally binding. Completion is the day ownership officially transfers to the buyer and keys are usually released.

How long does the buying process take?

The conveyancing process can vary depending on the transaction, but a straightforward purchase commonly takes between 8 and 12 weeks.

What is a mortgage agreement in principle?

A mortgage agreement in principle is an indication from a lender of how much they may be willing to lend based on initial financial information.

What happens if the seller pulls out?

Until contracts are exchanged, either party can withdraw from the transaction without legal obligation, although costs already incurred may still be payable.

Will I have to pay Stamp Duty as a first time buyer?

Some first time buyers may qualify for Stamp Duty Land Tax relief depending on the purchase price and eligibility criteria.

Can I buy a property jointly with someone else?

Yes. Property can be owned jointly, either as joint tenants or tenants in common, depending on how you wish ownership to be structured.

What should I look out for before buying a property?

Buyers should consider matters such as:

Property condition
Location
Lease terms
Service charges
Planning issues
Flood risks
Future maintenance costs

Why is legal advice important for first time buyers?

Buying your first home can feel overwhelming, particularly when dealing with contracts, mortgages and legal documents. A conveyancing solicitor can help guide you through the process and ensure your interests are protected throughout the transaction.