Buying a house has been described as possibly one of the most stressful times of a person’s life. For first time buyers, getting on the property ladder can seem daunting, but buying your first home is a milestone to be celebrated.  There are many considerations to think about when purchasing property. This article should act as a guide for first time buyers, highlighting key issues to consider during the process.

Budget and Finances

When you’re purchasing a property, it is important to know what you can afford and what your budget is. It is common for people to fund their property by way of a mortgage. Speaking with an independent mortgage advisor will determine how much you can borrow. This should give you a clear idea as to the deposit needed (usually 10%) and the property price you can afford.

The property market is fluid, and prices typically rise year upon year. The ‘Bank of Mum and Dad’ is often a way for first time buyers to get on the property ladder. If you are funding part of your purchase (such as the deposit) via a gift from a relative, it is important to discuss this early with your financial adviser. The Lender may require a signed Gifted Deposit Declaration from the person making the gift, and they will supply details.

It is paramount for first time buyers to be aware of their finances and expenses during the transaction. Depending on the purchase price, Stamp Duty Land Tax may also be payable, and this should be considered when saving for a deposit. Not only should first-time buyers have saved for a deposit, but also solicitor fees, Land Registry fees and disbursements which will also be payable at the end of the transaction

Property Tenure and Ownership

First time buyers should consider how they would like to own or ‘hold’ their property. Our article on property ownership covers this topic in more detail and can be found here. A Tenancy in Common is suitable for purchasers who own different shares in the property. The property does not automatically transfer to the other via the rules of survivorship. A Joint Tenancy means they own the property equally and cannot pass their property ownership by their will. The property automatically transfers to the surviving owner.

In instances where first time buyers have received a large gift from a relative who would like to be repaid, or where one party has contributed significantly more towards the deposit than the other, a Trust Deed will state the division of the ownership of the property and any terms on a resale.

Estate Agents

Estate Agents have a large involvement at the start of your property purchase journey. They negotiate the sale in the early stages of the process. Estate Agents can then either remain as little or as fully involved during the transaction as suits the buyers. Often there are times where lines are blurred during the transaction, so it is a priority to keep in communication with your property lawyer to ensure accuracy of information throughout your transaction.

First Time Buyer Solicitors London and Guildford

At Gordons Partnership, our dedicated First Time Buyer Solicitors are here to guide and support you through the conveyancing process. We are regulated by the Solicitors Regulation Authority (SRA) and committed to abiding by their strict Code of Conduct, so you can rest assured that we will always act in your best interest.

About the Author

Grace

Grace​​​​ Newlands

Paralegal

 

 

 

 

 

This article should not be taken as advice on any particular circumstance, and legal advice should be sought for a specific matter.