Make the Move. A Guide to Moving or Buying your First Home. Fills the gaps other insurance leaves behind

Transcription

1 Make the Move A Guide to Moving or Buying your First Home Fills the gaps other insurance leaves behind

2 You ve made the decision - you want to move property, or buy your first home. Now the minefield of information you need to know gets opened. So where do you start? Buying a new property can sometimes be a long and complicated process and even if you have been through it before it can still be a bit daunting. The good news is that if you have a good understanding of the process and some key tips on how to plan your move, you can avoid the common mistakes that often make the process more stressful than it needs to be. There are a lot of things that need to be done when you re planning to buy a new home. Our simple 10 step plan provides handy tools and checklists to help you through each stage of the buying process. The 10 step plan to buying a new home 1. Work out how much can you afford and a realistic budget 2. Find out how much you can borrow and arrange your mortgage in principle 3. Choose where you want to live and arrange viewings of properties in the area 4. Make an offer on the property you choose 5. Get your mortgage offer agreed by your lender 6. Have a survey and valuation made on the property 7. Hire a solicitor to manage the sale for you and exchange contracts 8. Get ready for your move 9. Finalise the contract with the solicitor 10. Moving day! Now let s look at some of the steps in more detail... A Guide to Moving or Buying your First Home - 2

3 Step 1. How much can I afford and what is a realistic budget? The first stage in planning your move is to have a good understanding of what your current outgoings are so you can get a clear idea of how any new mortgage costs will fit into your existing budget. It s a good idea to do a budget planner for your existing expenditure and then do a forecast of what all your new outgoings will be when you move home. You should make an estimate of what your new council tax will be and ensure you have enough money to cover the one off fees that you will incur. We ll explain more about these later. If you re thinking of buying a flat or leasehold property you should also include any service charges or ground rent in your budget calculations. No-one has a crystal ball to work out what the economy is going to do in the future. However, could you still afford the monthly repayment if the interest rate on your mortgage goes up by 1%? It is worth working this out in advance rather than running the risk of not being able to afford your new home over the longer term. Pulling together a budget Simply add up your total post tax income from all sources and then deduct expenses such as: Mortgage or rent Insurances Utilities Petrol/Public transport fares Cost of the weekly food shop Savings TV cable/satellite Loan/credit card repayments Childcare Clothes Shopping Leisure Try using our budget planner to guide you through. A Guide to Moving or Buying your First Home - 3

4 Don t get forget to budget for one off costs A common mistake that people make when budgeting for their move is to forget to take into account the one off costs you will incur in the process. In addition to having the cash available to pay your deposit you will also need to have funds available to cover these costs. Here s a list of most of the one off costs you need to consider and why you need to pay them: Estate Agents Fees It s only if you have a property to sell that you ll need to budget for these costs. Estate Agents fees can be charged either as a fixed fee agreed in advance or as a small percentage of the price you eventually sell your property for. You should always ask for a detailed breakdown of what services are included in the fees you agree to pay. Mortgage Arrangement Fees Some lenders charge fees to cover the costs of setting up the mortgage. If this applies it will be drawn to your attention at the time you choose your mortgage. Sometimes this fee is paid in advance or it can be added into the costs of your mortgage which you pay back in your monthly repayments. Remember, if it is added to the amount you borrow then you will pay interest on this fee during the term of your mortgage. A broker fee may also be payable to your mortgage advisor in return for their services. You should ask your advisor if a fee is payable in advance of them completing any work for you. Lender s Valuation Fee This is a charge made by the lender to value the property you intend to buy to ensure that it is worth what they are lending you. This valuation is commissioned by the lender and they choose who will do the valuation on your behalf, even though you are liable for the costs. When choosing your mortgage you should always ask what charges apply. Sometimes lenders offer free valuations as an incentive for you to take out your mortgage with them. Survey Fees When you have made an offer on a property and it has been accepted then it is strongly advised that you arrange for an independent survey to be completed. Legal Fees The legal work involved in buying a house is known as conveyancing, which a solicitor will do on your behalf. There is no standard cost for conveyancing services so it is a good idea to shop around for the best rate. You will also have to pay for the legal work done by your lender s solicitor. If you opt to use the same solicitor as your lender this can save you money but you should still compare the costs to other providers. A Guide to Moving or Buying your First Home - 4

5 Don t get forget to budget for one off costs Searches These are checks made by your solicitor on your behalf and are usually included in their charges. These searches check that there are no potential planning problems such as planning permission on neighbouring properties or plans for new roads nearby. These charges will usually be itemised under the Other fees and disbursements section of your solicitor s invoice. Land Registry Fees The Land Registry is a government department which holds records of the owners of properties registered in England and Wales. When a property changes hands there is a fee for transferring the register to the new owner. A fee is charged for completing this service which also varies depending on the value of your property. You solicitor will manage this for you and again this will be itemised in the charges. Stamp Duty Stamp duty is a tax levied by the Government on all properties over 125,000. The percentage payable is related to the value of your home at the time you buy it. If you want to find out exactly how much stamp duty you will be liable to pay see the HMRC website for more details rates-thresholds.htm You cannot borrow the amount you need to pay in stamp duty as part of your mortgage so you need to make sure you have these funds available in cash before you make a binding offer on a property. Removal Fees and other costs Most people hire a removal company to transfer all their belongings to the new property. This will need to be booked as soon as you have a moving date. Get a few quotes from some local companies to find the one which suits you best. It s also worth checking that the firm you go with has insurance that covers any breakages whilst your belongings are in transit as they will not be covered by your contents insurance. Other costs you may not have thought of are any disconnection and reconnection fees you may incur from utility companies (Gas, Electric, Telephone and Sky) and the cost of any mail redirection. These should all be taken into account. Estate Agents may charge additional marketing fees for advertising your property in newspapers, which is not included in their selling fee. A Guide to Moving or Buying your First Home - 5

6 Step 2. How much can I borrow and how do I arrange a mortgage in principle? Most people believe that when going for a mortgage they will be able to borrow 3 ½ times a single salary and 3 times a joint salary. However, in reality how much you can borrow depends entirely on your personal circumstances. Whilst the lending decision is mostly made based on your income and current outgoings other factors such as your credit rating and how much deposit you can put down relative to the amount you want to borrow will also be considered. In the current climate, most lenders would like you to put down at least a 20% deposit of the total cost of the property you want to buy. A further factor lenders take into account is how long you have been in employment with your current company and whether or not you are self employed. Any mortgage application you make will be scored by the lender to see how closely you match their criteria of who they want to lend to. Each lender has their own criteria that they score against, however all lenders will reference credit reference agencies to check that your credit rating is adequate. Your credit rating is calculated by these agencies and is based on your history of borrowing and repayment. It also takes into account any other financial assets or liabilities you may have and whether or not you have any County Court Judgements made against your name. If you have a low credit rating you will be considered a higher risk and could therefore be offered a less favourable interest rate or not offered a mortgage at all. There are many reasons why you could have a low credit rating and although a credit reference agency won t tell you exactly how they calculate your score you can find out what your score is and how you can improve it. Our useful contacts section provides details of these agencies and how to contact them. It is worth checking your credit rating in advance of making a mortgage application as if you are turned down for credit this can further damage your credit rating. If you want to get a very rough idea of what you can borrow, what the monthly repayments will be and at what interest rate online comparison tools can be a good place to start. Based on the details you enter about yourself, the aggregator will provide a list of mortgage deals for you to consider and usually formats the information in a way that enables you to compare products on a like for like basis. Once you have your list and worked out what you think looks best you can then approach a lender directly or if you feel you need more advice go to a Mortgage Advisor or Independent Financial Advisor. If you have a low credit rating you will be considered a higher risk and could therefore be offered a less favourable interest rate. A Guide to Moving or Buying your First Home - 6

7 What type of mortgage should I go for? When you take out a mortgage you agree to borrow a fixed sum of money (referred to as the Capital ) on which the bank charges you interest. You are liable to pay back both the capital and the interest over the term of the mortgage. The choice between a Repayment and Interest only mortgage is really a choice about how you pay back what you owe. Repayment This type of mortgage pays off the interest and the Capital over the term of the mortgage so at the end of the mortgage term, your home is fully paid off with nothing being owed to your banks or building society. Interest Only With this type of mortgage, you only repay the lender the interest portion of the loan so the repayments are cheaper. But the drawback is that at the end of the loan period, you still owe the original amount you borrowed at the start. To make sure you have the money to repay your lender, you will need to invest some money over the term of the mortgage and be confident that those investments will deliver enough return to pay back the loan. Here are examples of the various investments you could use to build up your funds: Endowment policy This is a form of savings with life assurance included. They are not generally available for new sales now, but if you have one already, you could use the amount you get at the end of the policy to offset against your mortgage. Pensions Pensions are tax efficient as you will receive tax relief on the payments you make to your policy. The fund you build up within your pension can be used on retirement to buy a lump sum from the pension provider. This can then be used to repay your mortgage. In addition, you will also receive a monthly income from the pension policy. You have to meet certain criteria for a pension policy, and make sure that you will be old enough to take the lump sum from it when you will need to have repaid your mortgage generally, the youngest age you can take benefits is 55. ISA This is a tax-efficient savings policy all the interest you get paid from it is tax free. So over a number of years, your savings can grow to give you an amount to repay your mortgage. The interest you will receive can go down or up, depending on the economy. Having made the decision how you want to pay, the next stage is to compare the types of mortgage available. A Guide to Moving or Buying your First Home - 7

8 Jargon Busting There are many different types of mortgage available on the market and it s important that you understand fully what you re signing up to. These are the main types: Fixed rate This means that the rate of interest you pay will remain fixed for an agreed amount of time usually a number of years. Terms of 2, 5 or 10 are most common. This type of mortgage is great if you want certainty of what you re going pay each month to help you budget. However, if general interest rates drop you will not benefit from this reduction. At the end of the initial term the interest rate is fixed for the mortgage will revert to the lenders standard variable interest rate. It s often at this stage people review their mortgage deal against what is available at the time. Variable rate With this type of mortgage your payments can go up or down throughout the term of the loan. If the mortgage rate changes, your repayment will change. If you opt for this type of mortgage you should make sure that you have sufficient budget to take into account any increase that may occur in the future. Trackers This is a type of variable rate mortgage but the interest rate is linked to the Bank of England base rate. The interest rate you are charged is usually 1 to 2% above the Bank of England base rate. As the Bank of England rate changes your mortgage rate will increase or decrease in line with that change. Capped rate This is a type of variable rate mortgage where a Cap is set at the outset which is an agreement with the lender that your mortgage rate will never exceed an agreed percentage rate. This means you can benefit from any rate reduction that occurs throughout the term of your mortgage whilst having the comfort that you always know what the maximum budget you will need to set aside for your mortgage repayments. Cashback mortgages These mortgages give you back a cash lump sum at the beginning of the mortgage. Although the cash may help you cover some of the fees you incur when you are moving house, you should compare the costs of these mortgages with other deals available. A Guide to Moving or Buying your First Home - 8

9 Jargon Busting Offset mortgages These types of mortgages combine a traditional mortgage loan with any deposit accounts such as savings or current accounts you may have. An offset mortgage works on the basis that for the calculation and charging of interest, the outstanding mortgage debt is offset against any savings or money you have in your current account. So if you had a mortgage of a 100,000 for example, savings of 9,000, and 1,000 in a current account for the purpose of calculating interest the 100,000 is offset to the 10,000 worth of savings. This means, you would only be charged interest on 90,000 of your mortgage borrowing. Irrespective of which route you take you should ensure that before you commit to making an application that you know the following: All the costs associated with the mortgage interest rates, application fees, broker fees and the costs of valuations Whether or not the costs are payable up front or are added to the loan What the penalties are if you repay the loan early What rate of interest applies after any introductory offer period has finished Is the mortgage portable if you decide to move again If there are any charges if you decide after making a mortgage application not to proceed A Guide to Moving or Buying your First Home - 9

10 Getting a Mortgage Agreement in Principle Once you have chosen the lender and the mortgage you would like to go with, the next stage is to get a Mortgage Agreement in Principle from them. You will go through an application form to establish whether the lender is prepared to lend you the mortgage you have asked for. You will be asked for details of your employment and your income and outgoings. If you have a current mortgage you will also be asked for details of that too. The lender will give you a yes or no decision based on this information but you need to remember that this is an Agreement in Principle and not a binding mortgage offer. This cannot be completed until you have decided on the property you want to buy and the lender has valued it to be confident it is worth the money they are lending to you. A Guide to Moving or Buying your First Home - 10

11 Step 3. Choosing your home and viewing properties Before you get down to looking at specific properties you should really think long and hard about the type of area and neighbourhood you want to live in. The location of a property is one of the biggest factors in how much its worth and how easy it will be to sell in the future so it s important to get this right. If you ve lived in an area all your life you ll already have a good idea of where the best places to buy are. However, if you re thinking of relocating it s really worth having a drive around the various areas you re considering at different times on different days to get a better feeling of what it would be like to live there. It s worth trying to do the journey to work in the morning from your chosen area to see what it s like at rush hour. It s also worth walking around the area at different times of day to see what the neighbourhood is like and check out how comfortable you feel. If you want to know whether you re moving to an up and coming area, a good indicator is something called Gentrification. This is when an area has an abundance of cafes, bars and trendy design shops. Another good sign is if new homes or flats are being built in an area by property developers. and are just two of the websites on the internet that contain a wide range of information about local house prices and trends, schools, crime rates and much more. The local government site can also give you information about schools, local activities, transport links etc which can also help you with your decision. Things to consider: How far away from family and friends will you be? Is it close to schools you want your children to go to? Will you be in the catchment area for these schools? Is public transport essential to you for commuting if so, how far away from stations/buses can you be? How close to shops and amenities do you want to be? Will you have enough car parking spaces? What council tax band will you be in? Is there easy access to healthcare? Hospitals, GPs etc What is the level of crime in the area? Getting a copy of the local newspapers will give you a good idea of this. What is the neighbourhood like? Are the other houses in the street in good condition? If they re poorly maintained or the area generally looks a bit shabby this could bring down the value of your property. Once you ve narrowed down the search a bit more it s worth speaking to people who actually live there and ask for their honest opinions of the best and worst points of the area. A Guide to Moving or Buying your First Home - 11

12 Now the search begins! Looking for your ideal property A good place to start looking is online property sites. These sites will give you access to a range of estate agents with properties that are currently on the market in the area you want to move to. Property sites that are currently very popular are and Not all the properties available in a particular area will be advertised on these sites. Some independent estate agents may not advertise with these sites so it s still worth visiting local estate agents offices and looking in the property pages in the local newspapers. If you re not in a hurry to move and fancy buying a brand new property, another place to look is house building companies. You will usually only be able to visit a show home on the development and you have to be prepared to buy your home off plan. Buying a house before it s even been built can be a little too nerve racking for some people. Auction properties are normally redevelopment projects, repossessions or estate sales where the property has been vacant for some time. Unless you have experience it s probably best to leave it to the experts. This is the reason why many of the properties sold at auction are to builders and property developers. If you want to explore this route you can get some further guidelines on buying at auction from Leasehold or Freehold? When choosing which properties to go for you should always check whether or not the property is sold as Freehold or Leasehold. Freehold means that you own the land on which the property is built. Leasehold on the other hand does not include the land on which the property is built instead you pay a ground rent to the owner of the land the freeholder. You only have the right to occupy the property for the length of time left on the lease. It is common for Flats to be sold on a leasehold basis. It is always worth checking the amount of time left on the lease for any leasehold property as this will affect the value of the property. Another source of properties for sale is property auctions. Although buying a home at auction can be cheaper than buying through other traditional routes it is also much riskier as you will be unable to get the property surveyed before you start bidding. You will also be required to have the full mortgage offer agreed in advance and you will have to get your solicitor to do some work in advance to ensure that there are no legal issues with the property you propose bidding on. A Guide to Moving or Buying your First Home - 12

13 Getting the best from viewings Once you have made a shortlist of properties you re interested in you should contact the estate agent to arrange a time for you to view. When you visit the property you should make notes about the property against the following criteria: First Impressions How closely does the property meet your wish list? What is the general state of repair and general decoration of the property? What fixtures and fittings are included in the sale? Fixtures and fittings include kitchen appliances, carpets and curtains. What is the state of repair of the rest of the houses in the street? Does this suggest the area is thriving or going down hill? Heating, power and plumbing Is the property centrally heated? If it is how old is the system? When was the last time the boiler was serviced? Is the roof well insulated? If you go in the loft and turn off the light you shouldn t be able to see any patches of daylight through the roof. Is the house fully double glazed? How old is it? Are the pipes and the boiler lagged? How old is the plumbing? How old are the plug sockets and light switches? Old fashioned switches may suggest that the house needs rewiring. The best house hunters write notes on each property they view and compare them. This enables you to get a good sense of what you can get for your money. Potential problem areas Subsidence Look out for evidence of subsidence. From the outside of the house you should look for big cracks in the walls, a bent chimney stack or an uneven roofline. From the inside look for big cracks in walls or ceilings and also try shutting the internal doors. Doors that stick or don t hang correctly could also suggest subsidence. Damp A musty smell when you enter the property could indicate that it has a damp problem. Look for mould, or discolouration to paint or wallpaper. Flaking wallpaper or paint could also be due to damp. From the outside you should also check for missing roof tiles or cracks in the brickwork which could also let in damp. Woodworm This is harder to check for but lots of small holes in banisters, door frames and floor boards could indicate woodworm. Root damage to foundations If there are any very large trees close to the property this can cause problems which a survey should identify. A Guide to Moving or Buying your First Home - 13

14 Step 4. Making an offer Although the Estate Agent will have detailed what the sellers asking price is you should not make the mistake of assuming this is what you have to pay for the house you choose. Ultimately, a house is only worth what someone is prepared to pay for it and there are many factors that can affect what price the seller will settle for. It s worth doing some research on how much comparable homes in the area have sold for. Although the value can differ if there have been extensions or renovations completed this information provides a useful benchmark on what houses in the area you re going for can command. Websites such as and provide data based on the sold prices for properties registered with the Land Registry. It s definitely worth haggling - start by making an offer that is less than the asking price. The seller can always try to negotiate upwards but you ll find it much more difficult to try and reduce an initial offer if you go straight in with the asking price. You should always confirm that any offer is subject to contract and survey. This means that you are not legally bound to proceed until a satisfactory survey and legal contracts have been completed. Make sure that your offer is confirmed in writing and details what fixtures and fittings you expect to be included in the sale. As soon as you have made an offer which is subject to contract and the seller has accepted it you should request that the seller takes the house you want Top Tips When making an appointment to view a property it s worth asking the seller or estate agent the following questions: How long has the house been on the market? How much interest has been shown? Are the sellers looking for a quick sale? Have the sellers already found somewhere they want to move to? What is the reason the seller is moving? The answers to these questions will give you a view on how open the sellers will be to you making an offer which is below the asking price. to buy off the market. This prevents a situation where another potential buyer could gazump you by offering more than you have whilst you re getting you mortgage and the legal contracts sorted. In Scotland the legal process which applies when buying a house is different to that for the rest of the UK. Once you have agreed the details of an offer with a seller you are legally bound to go through with the sale and could be subject to pay any damages if you decide to pull out. As this is the case it is best to engage a solicitor to manage the offer process for you when buying a house in Scotland. A Guide to Moving or Buying your First Home - 14

15 Step 5. Get your mortgage offer agreed with your lender In order to complete the full mortgage application you will need to provide the following: 1. Proof of your identity This means that when applying for your mortgage the lender will need to see a copy of your passport, driving licence or birth certificate. They will also ask you for your National Insurance Number. 2. Proof of your address Lenders will require you to provide proof of your address (es) for the last 3 years. Utility or council tax bills are acceptable for this purpose. 3. Details of your employment The address and contact details of your employer. If you re self employed they may ask for full details of your accounts so ask in advance of making your application what kind of evidence they need to see. Lenders can only make a binding mortgage offer at this stage of the process as the money they will lend you is secured against the specific property you will want to buy. Depending on how long it s taken you to find the perfect home, the lender who gave you the mortgage offer in principle (step 2) may no longer offer the mortgage you applied for and there may be better deals on the market. Once you ve shopped around to secure the best deal the next stage is to complete a full mortgage application. 4. Details of your financial situation You ll be asked for copies of your recent pay slips as proof of your income. You ll also be asked to supply documentation about any outgoings you have such loans, credit cards and store cards as well as copies of your recent bank statements. The lender will also ask for a detailed breakdown of any savings, investments or any other properties you may own. 5. Current mortgage If you have a mortgage currently, you will be asked for a copy of your latest mortgage statement and a redemption statement from your current lender. 6. Full details about the home you want to buy This includes the property details you ve been given about the home you want to buy and how much you ve agreed to offer for it, the choice of the mortgage product you wish to go for, the valuation/survey requirements, your mortgage protection insurance requirements, your home insurance requirements, you solicitor s/convenyancer s details Unlike your application for a mortgage in principle this application will require more detailed information about the property, the type of survey you want and the details of a solicitor you will use. They will also require evidence of your income and outgoings. You will not receive a confirmed mortgage offer until a valuation of the property you want to buy has been completed by the lender as they will want to be certain that the house is worth what you want to borrow from them. This is the next key step in our guide. A Guide to Moving or Buying your First Home - 15

16 Step 6. Have a survey and valuation made on the property Your lender will get a valuation completed on the property to check that it is worth what you are paying for it. If the valuation completed by the lender is less than that which you have offered to the seller then your mortgage offer may be withdrawn or be made subject to certain repairs or renovations being completed. If this happens you should ask the surveyor who completed the valuation on the lenders behalf to explain fully why they believe the property isn t worth what you have offered. This should give you all the information you need to be able to renegotiate your offer price with the seller. Although a surveyor completes the valuation for the lender, this should not be confused with a full survey. A valuation will not give you any details on any structural problems there may be with the property that you will need to fix, it only focuses on whether the price you want to offer is worth the property in its current state. If you want to be sure there are no major issues with the property you intend to buy, the only way you can really be sure of this is by commissioning an independent survey. A survey will identify any major work that might need doing, things that you as a non-expert would not be able to spot. Although you may think this is a cost you can t afford, it is far cheaper to have a survey than to fix major structural faults once you have bought the property. A survey should always be completed before exchanging contracts so that any major faults can be put right before you move in or you can renegotiate the asking price of the property to take into account the costs of any work which need to be done. The estate agent, your solicitor or the lender will all be able to recommend a surveyor they have used. If you decide to use the same surveyor the lender is using for the valuation this can often save time and money as your survey can be done at the same. Types of Survey There are two types of independent survey a Home Buyers report or a more comprehensive Structural Survey (also known as a Building Survey). Home Buyer s Report A Home Buyers report is usually for standard properties in a reasonable condition up to 150 years old. It will check for major faults and give you the estimated costs to put things right. A Structural Survey A Structural Survey is a more comprehensive survey that is usually used for older, unusual or listed buildings. These surveys are also advised for properties that have had extensions or renovations. A Structural Survey may highlight that further reports are required from specialists so you should be prepared for these costs too. If you are buying a newly built home you won t need a detailed survey as it should have a NHBC certificate. A National House Building Council certificate gives a 10 year guarantee, covering any major fault or problem in your new home. A Guide to Moving or Buying your First Home - 16

17 Step 7. Hire a solicitor to manage the sale for you and exchange contracts The legal work in buying a house is known as conveyancing, which can be a complex process both legally and administratively which is why it is best for a solicitor/conveyancer to do this on your behalf. Once the survey has been completed and is satisfactory and you have received your formal mortgage offer your solicitor will get in touch with the sellers solicitor to draft the contract. It s your solicitor s job to highlight anything in these searches and enquiries that may make you want to pull out of buying the property prior to you exchanging contracts with the seller. Once all checks are made and you are happy with the draft of the contract, your solicitor will need to agree a date for when the sale will be finalised. This is called the completion date and it is the point at which you take legal possession of the property. Once all the detail is agreed you will be ready to exchange the final contracts for signature by you and the seller. Part of the contract will also include things that are to be left in the house. Here are some examples of things that could be included: carpets, ceiling and wall lights, curtains, bedroom furniture, bathroom fittings and garden sheds. When you exchange contracts you will need to hand over the deposit to the solicitor. Once the contracts are exchanged and signed both parties are legally bound to go through with the transaction. If you decided to pull out of the sale at this stage its very likely you would lose your deposit and you could potentially be sued for breach of contract. If you have agreed that the seller would do any repair work on the property as a condition of the sale it s important that you check that this has been done as it will hold up the completion of the contract. Your solicitor will cover the following things for you: Check the title deeds of the property to ensure there are no issues Make checks to make sure that any planning permission the current owner has have got the relevant sign-offs or certificates from the government planning department Check the local authority maintains drains, streets and pavements Will draw up the contracts between you and the seller of the property (liaising with the sellers solicitor) Register the change of ownership with the Land Registry Request any searches from the local authority of information about the property and any planned developments within the area which may affect your property, such as a major road being built or local business planning expansion and building work A Guide to Moving or Buying your First Home - 17

18 Step 8. Getting ready for your move By working with your solicitor whilst they are drafting the contracts you will have agreed the date when you want to move in. As your completion date comes closer, there are various tasks you ll need to complete and companies you will need to let know about your change of address. Key things you need to do as soon as possible Book time off work around your confirmed moving in date If you re renting give notice to your landlord Book the removal company or hire a van if your family and friends are helping you move Contact utilities companies (Gas, Electricity, Water and Telephone) to give them notice your moving date Contact the Council Tax office and tell them your moving date Arrange any insurances that are a condition of your mortgage Start Packing! Top tips on packing The key thing is don t leave it too late! Start packing your things up as early as possible. Get everything you need boxes, thick parcel tape, labels, black bin bags and protective bubble wrap for your fragile possessions. Closer to the moving day: Check what time you can get access to your new home Confirm these times with your removal firm Speak to neighbours at your old and new house to make sure they leave parking space for the removal van Contact the sellers to check that you know where water cocks, fuses boxes and gas/electric/water meters are Arrange for a parking permit if you need one at your new house Ask the seller to clearly label all window, garage, shed keys etc and agree one place where you ll be able to find them Ask the seller to put all important manuals (central heating, kitchen appliances etc) in one place Start working your way through all the people you need to contact about your address change Clearly label all your boxes with: The room they need to go into at the new property Whether they are fragile. It may be a good idea to get some Fragile stickers to put on the boxes so that they can be clearly seen If necessary, which way up they should be carried Your removal company will be able to advise you on how to pack and which things you should pack first. A Guide to Moving or Buying your First Home - 18

19 Key contact checklist Our checklist should give you a good idea of most of the people who you will need to contact when you move. Its worth arranging with Royal Mail for any post to be redirected to your new address just in case you have forgotten anyone. Details of this can be found at and can be arranged for 1, 3, 6 or 12 months, with varying costs depending on the length of time you choose. Royal Mail to get your post redirected Your employer Your children s school or nursery Gas Electric Water Phones landline and mobiles Council tax Sky/Virgin TV Internet provider Banks Building societies Credit card companies TV licence Car insurance Buildings and Contents insurance Life assurances Any income protection insurances Doctor Dentist Optician Vet DVLA to get your driving licence updated with your new address Inland Revenue Friend and Family A Guide to Moving or Buying your First Home - 19

20 Protecting your investment Buying a new home is the biggest investment you are ever likely to make so it s important that you have appropriate insurance in place to protect it. The key insurances you may need are detailed below: Buildings Insurance Buildings insurance covers you for any damage to the structure of the property and essentials such as kitchen and bathroom fittings. The level of buildings insurance cover you need must be enough to cover the cost of rebuilding your home in the event of severe damage however this is not the same value as the price you paid for it. The rebuild cost of your home will be included in your surveyors report or valuation. Some buildings insurance policies include cover for legal expenses. Although this is not essential it may be worth considering as it covers the costs of any private legal actions you may need to take to resolve issues with nuisance neighbours or disputes on right of way. For freehold properties most lenders will insist on seeing a copy of your buildings insurance certificate before they will release the mortgage funds so you need to get this in place to avoid any delays. Make sure you have the buildings insurance in place from the date you exchange contracts. Contents Insurance Contents insurance covers your personal possessions. This is not an insurance policy that mortgage lenders insist upon you having but it does make sense to have cover in place. To calculate how much cover you will need go through every room in your house and make a list of what s in there and estimate of how much it would cost to replace. This should include the costs of replacing carpets and curtains. This will give you the level of cover you should insure your contents for. Most contents insurance covers have what is called a single article limit which is the maximum amount of benefit that they will pay for any single item. If you have some really valuable items such as jewellery or paintings make sure you draw this to the insurer s attention. You can arrange cover for these items but they will need to be specified separately from your other contents and sometime you will need to pay an additional premium to cover them. The level of buildings insurance cover you need must be enough to cover the cost of rebuilding your home in the event of severe damage A Guide to Moving or Buying your First Home - 20

21 Protecting your investment Life Insurance Some lenders insist that you have sufficient life insurance in place to pay off your mortgage in the event of your death. However, even if they don t you should consider taking out cover to ensure that your family and dependents are covered should the worst happen. The main types of life insurance are: Level Term Insurance Pays your family a fixed cash sum that remains the same throughout the term of your policy. Critical Illness Cover Pays out a lump sum if you are diagnosed with certain specified illnesses during the term of your policy. It can be obtained as stand-alone cover or as part of a life insurance policy. Income Protection This type of protection will give you a regular monthly income if you can t work as a result of accident, sickness or unemployment. Mortgage Payment Protection insurance This type of insurance will cover you if you are made redundant or have an accident or are ill. It will pay your monthly mortgage payments and insurance premiums, usually for up to 12 months. For more information and a quick insurance quote visit: Mortgage Life Insurance or Decreasing Term Assurance Designed to pay off your mortgage in the event of your death with the benefit amount decreasing in line with your outstanding mortgage balance. A Guide to Moving or Buying your First Home - 21

22 Step 9. Finalise the contract with your solicitor The final step you will complete with your solicitor to finalise the sale is called completion. As the completion day comes closer you should keep in close contact with your solicitor to make sure everything is on track. The following things will happen at completion stage: 1. Your solicitor will liaise with your mortgage lender and ensure the money transfers into their holding accounts. 2. The outstanding balance that you need to pay for the house (the agreed purchase price less the deposit) will be paid to the seller by your solicitor. As the completion day comes closer you should keep in close contact with your solicitor to make sure everything is on track. 3. The legal documents transferring legal ownership of the property (transfer document and title deeds) are passed to your solicitor. These are usually held by your mortgage lender until the full mortgage has been repaid. 4. You should have provided your solicitor with all funds needs to pay all the extra costs that are incurred in moving such as stamp duty and Land Registry Fees. 5. Your solicitor pays the additional fees on your behalf 6. Your solicitors completes a set of final accounts detailing all the money they have handled on your behalf 7. You can collect the keys as the seller has to have vacated your new home. A Guide to Moving or Buying your First Home - 22

23 Step 10. Moving Day! The big day has arrived and after months of planning you ll finally be able to move into your new home. Moving day can be stressful but hopefully the following tips and hits will help you ensure that things go as smoothly as possible. As soon as you wake up Make sure that your neighbours have remembered that today is your moving day and have left sufficient space for your removal van in front of your house. Take your pets to a family or friends before the removal firm arrive. You don t want the removal men tripping over your pet or run the risk of losing them as all your doors are likely to be left open whilst the removal van is being loaded. Take final meter readings for your gas and electricity and ring these through to the utilities company. When the removal men arrive Explain everything that you are taking with you, what boxes contains things which are fragile and what is being left behind. As soon as this is done the best thing to do is keep out of their way as the removal firm will know how the removal van needs to be packed to ensure everything fits in. Whilst the removal van is being loaded, take a little time to say goodbye to your neighbours and give them your new address. Keep Essentials in Easy Reach Put together a box of essentials that you ll need as soon as you move to your new home. Key things to include: The kettle, mugs, tea, coffee, milk and sugar. Your mobile phone charger Cleaning materials, bin bags and a dust pan and brush Toilet paper Light bulbs and a torch Pen and notepad Leave your address and contact details on a piece of paper in the kitchen of what is now your old house asking for the new tenants to forward on any mail which isn t automatically redirected. A Guide to Moving or Buying your First Home - 23

24 Moving Day! At the new house Make sure you arrive before the removal men so you can direct them where you want them to put your belongings. If you ve labelled up your boxes when you packed them, this process becomes much easier to manage. Check that all the utilities are connected and take meter readings. You should contact your utilities companies as soon as possible and give them this start reading as the basis from which you ll be billed in the future. Unpack the boxes which go in the kitchen and your bedroom first. These are the key rooms that you need to be able to use on the day you move in. Put the kettle on and enjoy your new home! A Guide to Moving or Buying your First Home - 24

25 About helpucover helpucover opened its doors in 2007, and since then has worked tirelessly to help customers make sense of insurance and get the cover they need. We pride ourselves on our different approach to insurance offering simple, flexible products that our customers can personalise in a way that suits them best. helpucover has other guides available which you can download from Guide to Buying Household Appliances Our products don t just provide a cash payment when the worst happens but also include a range of useful services that you can use to help you get back on track or adapt to a change in your circumstances. Our aim at all times is for customers to be empowered by having information that is easy to understand which helps them make the choices that are right for them. This is why we have created this guide which we hope you found useful. Simple Guide to Choosing, Owning and Caring for a Pet Simple Guide to Buying a Car A Guide to Moving or Buying your First Home - 25

26 Useful Contacts Buying or Selling a Home Council of Mortgage Lenders contact for information about mortgages Energy Performance Certificate Register for details about Energy Performance Certificates Home Report Scotland for details about Home Reports that are only required in Scotland HM Revenue & Customs for details about Stamp Duty Property Search Websites Right Move Prime Location Find a Property Zoopla Credit Reference Agencies Companies you can contact to find out your credit score Call Credit Equifax Experian Mortgage Advice Which Money Saving Expert Financial Ombudsman Service Association of Independent Financial Advisers Association of Independent Mortgage Intermediaries Estate Agents National Association of Estate Agents Guild of Professional Estate Agents House Prices Land Registry House Price Index Registers of Scotland: Scottish house prices House Price Index RICS housing market survey Other online resources Up My Street A Guide to Moving or Buying your First Home - 26

27 Useful Contacts Land Registry HM Land Registry Registers of Scotland Land Registers of Northern Ireland Removals The British Association of Removers The National Guild of Removers and Storers Solicitors & Conveyancers The Law Society England and Wales Scotland- Northern Ireland The Council for Licensed Conveyancers Research sites Council Tax bandings England and Wales Scotland- Office for National Statistics Public Transport links NHS Services Environmental, flood and pollution risks homeandleisure/37793.aspx School reports Mobile phone masts Road developments Surveyors The Royal Institute of Chartered Surveyors Independent Surveyors Association A Guide to Moving or Buying your First Home - 27