Don’t rush out and buy that new lamp just yet because before you start looking for a place to buy, you need to work out exactly what you can afford. Doing this will help you to plan and narrow down your search, making sure you are not going to overstretch your budget. It’s also a good idea to talk to lenders about mortgages as early as possible.
Work out what your monthly outgoings are likely to be once you own your home - your family or friends who already own their own home may be able to help you with this.
You can get an idea of how much could you borrow? and how much you are likely to pay each month with our easy-to-use calculators. It's worth speaking to a mortgage expert as your individual situation will affect how much you can borrow and how much you are likely to pay. Call us on 0800 028 0639.
As well as making sure you have enough money to pay for your monthly outgoings, you also need to be sure you have enough to cover the initial costs of buying a home. These will vary, depending on things like where you choose to buy, what fees your lender charges and what type of survey you want to have. The table below gives estimated average costs.
| Expense | Charge |
|---|---|
| Stamp duty land tax | If you are buying a leasehold or freehold property, and the purchase price is more than £125,000 then you will need to pay Stamp Duty Land Tax of between one and four per cent. |
| Legal fee | £463 |
| Valuation fee | The valuation fee is paid to cover an inspection of the property to ascertain its acceptability to the lender as security against the mortgage loan. The level of fee varies with the value of the property, and whether you choose to have a Mortgage Valuation, Survey and Valuation or Building Survey and Valuation. |
| Mortgage and arrangement fee | £499 |
| Searches | £200 |
| Land Registry | £150 |
| Total | £1,723 + stamp duty land tax and valuation fee |
