First-time buyer questions

emz8

Hi all,

Have just gone sale agreed on a house. We were approved 225 mortgage. The house we bought is 270. We have 47 in savings and have just been given a gift of 5 grand so its all working out just about affordable!

My question is (and probably a stupid one, but I love this house and am a nervous wreck about it falling through) will the bank still approve us for the 225 despite the fact we really pushed to the top of our budget? I can't see how this would be a problem as it won't affect our ability to repay, but just curious.

Also, I keep hearing of sales 'falling through', why is this? What is causing so many sales to fall through?

If the bank has any issues with this house, how soon before we find out?

And lastly, we are currently renting, our land lord is happy for us to just give one months notice rather than seeing out the end of lease.

Will we be given a date that this will all be completed (vendors are also eager to move) or is it just a case of...waiting to see what happens?
Afraid we will give notice then sale won't be complete and we'll be stuck in between!

Anything else you feel a complete rookie should know feel free to share!
Thanks

melie122

Hi Emz8,

Just new to boards and fellow first time buyer Congrats on going sale agreed. As long as you were approved already and have the deposit plus other fees such as stamp duty / solicitor etc the bank shouldn't have any issue.

We are currently just gone sale agreed on our second property after the first one fell through due to the bank valuation report. We were annoyed at the time but glad now it didn't go through as we would have ended up paying more then the property was worth.

If the bank have any issue you will no once you have arranged the valuation reports. We found out the last time within a week.

Lastly all going well once your solicitor recieves the paper work I think they agree an estimated closing date with the sellers solicitor and will let you know this.

Best of luck. Know what'd your going through.

Thanks

farrerg

Estimated closing date is an important point here, in nearly every mortgage there is some small hitch, be it a solicitor who goes on hols, someone missing a signature somewhere and docs have to be sent back, an address incorrect on home insurance policy etc etc. Dont leave it too tight with your moving dates, you are better off having a bit of flexibility because it can be stressful enough trying to move without worrying about being homeless for a couple of weeks

The bank won't care that you are borrowing the max, once you have the funds needed to make up the balance plus stamp duty, they're happy

farrerg

melie122 wrote: »

Hi Emz8,

Just new to boards and fellow first time buyer Congrats on going sale agreed. As long as you were approved already and have the deposit plus other fees such as stamp duty / solicitor etc the bank shouldn't have any issue.

We are currently just gone sale agreed on our second property after the first one fell through due to the bank valuation report. We were annoyed at the time but glad now it didn't go through as we would have ended up paying more then the property was worth.

If the bank have any issue you will no once you have arranged the valuation reports. We found out the last time within a week.

Lastly all going well once your solicitor recieves the paper work I think they agree an estimated closing date with the sellers solicitor and will let you know this.

Best of luck. Know what'd your going through.

Thanks

Was the valuation markedly different from the asking price % wise say?

emz8

Thanks for the responses!

Thanks Melie122, Congrats to you to!
The houses in the area are going for about 30-40 grand cheaper, but this house has a huge extension,attic converted, and bigger garden. As well as being finished to a very high spec. so I'm assuming that will make valuation accurate?

That's what we were thinking Farreg. Because the vendor is in a hurry to go they were saying six weeks, but have yet to give an actual date. We are hoping to be gone by the end of August, otherwise it'll be another months rent. I imagine a turnaround time of six weeks is rare though!

Fingers crossed anyway!

kippy

emz8 wrote: »

Thanks for the responses!

Thanks Melie122, Congrats to you to!
The houses in the area are going for about 30-40 grand cheaper, but this house has a huge extension,attic converted, and bigger garden. As well as being finished to a very high spec. so I'm assuming that will make valuation accurate?

That's what we were thinking Farreg. Because the vendor is in a hurry to go they were saying six weeks, but have yet to give an actual date. We are hoping to be gone by the end of August, otherwise it'll be another months rent. I imagine a turnaround time of six weeks is rare though!

Fingers crossed anyway!

6 weeks is almost unheard of.

Little Miss Cutie

kippy wrote: »

6 weeks is almost unheard of.

We did it in 6 weeks but it took work in out side to keep everything moving and we had an excellent solicitor

MarkAnthony

Six weeks is doable, you need a solicitor on the ball - doesn't necessarily have to be Alan Shore and for any one of a million things that can go wrong, not to go wrong.

There are endless things that could happen, my advice is don't give notice to your LL until you're in. In my case searches, that happen on the day you close, came back with an issue. Luckily we had our own place to fall back on which we rented out after we moved. Other than that don't count on anything until you're in.

Basically even after the deposit is paid (as distinct from the booking deposit which is meaningless) unless you're willing to spend 12K+ seeking an order of specific performance the vendor can pull out at anytime.

All that said - after a great deal of patience I'd say most sales that get to the stage that solicitors are fully involved go through. I's say, roughly the stages are:

Offer being accepted
Survey
Bank valuation - assessing the risk of recouping their mortgage if you default
Back and forth if the vendors are in a chain
Searches

My only concern over what you've posted is you're going to struggle when you move in if you're running low on funds but then half the fun if finding chairs on skips to sit on for the first few months. You've obviously factored ion stamp duty, legal fees, misc fees, LPT etc. I assume?

Very best of luck with it!

The_Conductor

6 weeks- in the middle of July- with everywhere effectively closing down for most of August? Forget it....... Any other time of the year would be an ask- but in August- its day dreaming........

As to whether or not your mortgage approval stands- its 80 or 90% of what the bank's valuer values the property at- not 80-90% of what you have offered to pay for it.......

You need to contact your proposed lender and ensure all is in order- esp. if you're paying significantly over what other properties in the area have sold for in the recent past.

Peonygrace

Also in this position....we are going back and forth about the offer.
Re the bank lending based on what their valuation of the property is....if they come in significantly lower than the offer accepted, can this be used as leverage to renegotiate the offer? Sorry if this is a stupid question, new to all this myself.

The_Conductor

Peonygrace wrote: »

Also in this position....we are going back and forth about the offer.
Re the bank lending based on what their valuation of the property is....if they come in significantly lower than the offer accepted, can this be used as leverage to renegotiate the offer? Sorry if this is a stupid question, new to all this myself.

You can try- but what is widely happening at the moment- is the sale falls through- and the property is put back on the market. One property very near me (in the same development)- has had 4 sales fall through since last February. One receiver I was talking to recently said sales falling through 3-4 times- is now considered normal (which seems crazy to me). Many estate agents are trying to ascertain that people are actually approved for the amounts they are bidding- as seeing the same property come back 3-4-5 times- is a waste of everyone's time and money.

Don't bid- unless you have the backing to follow through on your bid.

emz8

Thanks for all the advice!

The solicitor we have hired is apparently very on the ball! A good few people have recommended her. The vendor is not in a chain and is eager to go so is also pushing it.

We have extra money aside for fees etc and have pretty much everything but a table and sofa and then little bits so we're sorted with pretty much everything we can think of.

Guess it's all in the banks hands now! My nerves are absolutely gone with the thoughts of losing this house. Been looking and bidding for so long, and am so in love with this house!

emz8

Just an update on this, we got our keys exactly 4 weeks after going sale agreed!

We didn't do anything to push it through, it all just worked out really well. So we have our keys, but still have our apartment till the end of September! Don't even care we are so happy our house hunting days are over!

Thanks again for all the advice!

Peonygrace

I also got the keys to my house - so exciting.
Thanks again to all esp. MarkAnthony for all the advice.
Now to start Operation Renovation....eek!