Before your bank or building society will issue your cheque you will need to get two forms of insurance sorted out.
The first is life insurance,and the second is home insurance.
For the life assurance you have two main options: term insurance or life insurance. Term insurance gives you more cover, but costs slightly more. What it is is insurance of a fixed amount for a fixed length of time (usually the term length of your mortgage). If (God forbid!) you should die before the length of the mortgage the entire amount covered is paid out. So, for example if you have a 500k mortgage and take out term insurance, but over the years you'd paid back 90% and then die, whoever you leave your estate to will get 90% back as the full 500k will be paid out (so 10% to pay rest of mortgage, and 450k left over). Term insurance costs a little more, but as you can see it pays a lot more later on too.
Home insurance is very important, as your mortgage provider will not issue your cheque without it.
One VERY IMPORTANT bit of advice is to get the home insurance to be started a few days before you close the sale. We were caught with that. Our close date was a Friday and we got our insurance to start on the Friday. But on the Tuesday when our solicitor asked the bank to issue the cheque they said no, as we didn't have insurance in place. So, we had to get it moved forward to start a couple of days earlier. Not a big deal, but it was a major stress at a time when we were highly strung already.
Monday, April 14, 2008
Friday, April 4, 2008
Step 14: Contract deposit
This happens at the same time as step 13, but I thought I'd make another step of it to make sure you notice it.
When you sign your contracts you will also need to pay the rest of your deposit. This is standard at 10%, but it is usually possible to negotiate it down - for example if you get a 92 or 95% mortgage you may only want to pay 5 or 8% as the deposit and have the rest come directly from your mortgage. Once you have a valid reason your solicitor should be able to agree this with the vendors solicitor.
As this is generally delivered as a bank draft (not a cheque), it is a good idea to arrange the bank draft before you sign (a day or two should be enough time, but you should confirm this with your bank as they differ).
When you sign your contracts you will also need to pay the rest of your deposit. This is standard at 10%, but it is usually possible to negotiate it down - for example if you get a 92 or 95% mortgage you may only want to pay 5 or 8% as the deposit and have the rest come directly from your mortgage. Once you have a valid reason your solicitor should be able to agree this with the vendors solicitor.
As this is generally delivered as a bank draft (not a cheque), it is a good idea to arrange the bank draft before you sign (a day or two should be enough time, but you should confirm this with your bank as they differ).
Step 13: Contracts
The next step is the first legally binding one: Contracts.
The vendors (people selling) will draw up contracts of sale with their solicitor. This is a long document - about 30 pages roughly - which has a hell of a lot of legal mumbo-jumbo which all comes down to "We give you cash, you give us house".
What they send is a draft contract, and they send that directly to your solicitor. Your solicitor will usually send you some notes on it and maybe some questions. For example, ours asked us to check the land registry documents referred to the right land with the engineer who did our survey.
Normal procedure is that you will go into your solicitors office and sign both the loan offer (see step 12) and your sale contracts at the same time in their presence. They send these back to the vendor with a bank draft for your outstanding deposit (Step 14). Usually at this point your solicitor will confirm the charge for their service - the start of your money disappearing!
The vendors (people selling) will draw up contracts of sale with their solicitor. This is a long document - about 30 pages roughly - which has a hell of a lot of legal mumbo-jumbo which all comes down to "We give you cash, you give us house".
What they send is a draft contract, and they send that directly to your solicitor. Your solicitor will usually send you some notes on it and maybe some questions. For example, ours asked us to check the land registry documents referred to the right land with the engineer who did our survey.
Normal procedure is that you will go into your solicitors office and sign both the loan offer (see step 12) and your sale contracts at the same time in their presence. They send these back to the vendor with a bank draft for your outstanding deposit (Step 14). Usually at this point your solicitor will confirm the charge for their service - the start of your money disappearing!
Monday, March 31, 2008
Check your loan offer
This may seem very obvious, but it is so important that I am writing a post about it.
You will recieve a copy of your loan offer to sign and return, along with a number of related documents. Be sure to check all the details - especially the address. We got ours the other day and realised that the address of the house we are buying in Galway was spelt incorrectly. Initial thought was that it wouldn't matter, but it turned out we needed to get the offer re-issued, causing a few days delay.
It is very important to ensure that your names, all amount, and all addresses are spelt correctly. It is up to you to do this as it is you who is signing up for the loan.
The last thing we wanted was a delay, but we are delighted to have noticed now while we have time to rectify it rather than when we are signing contracts, or even closing. Luckily we have a great mortgage adviser who was able to get it re-issued in 48 hours.
You will recieve a copy of your loan offer to sign and return, along with a number of related documents. Be sure to check all the details - especially the address. We got ours the other day and realised that the address of the house we are buying in Galway was spelt incorrectly. Initial thought was that it wouldn't matter, but it turned out we needed to get the offer re-issued, causing a few days delay.
It is very important to ensure that your names, all amount, and all addresses are spelt correctly. It is up to you to do this as it is you who is signing up for the loan.
The last thing we wanted was a delay, but we are delighted to have noticed now while we have time to rectify it rather than when we are signing contracts, or even closing. Luckily we have a great mortgage adviser who was able to get it re-issued in 48 hours.
Tuesday, March 25, 2008
Step 12: Formal loan offer
Once your valuation has been done, your next step is to get your formal loan offer letter from your bank or building society.
If you are using a mortgage broker they will take care of this step for you, or if you are organising your mortgage directly with a bank/building society you just need to contact them and ask them to do it for you.
At this stage they will again want to check your financial details, and may ask you for bank statements for the period between your initial approval in principle and now. It took about 4 working days for us, which I believe is normal. However it can take a little longer so allow about 2 weeks.
You will be sent a copy, and your solicitor will also be sent a copy. It is quite a big document, but it is well worth reading through it all to be sure you know what you are getting. Your solicitor or mortgage broker should be able to answer any questions you have.
The copy your solicitor receives will ask them to proceed with the legal formalities and will usually give you 30 days to do so. Hopefully your contracts will arrive about the same time as your letter of offer.
If you are using a mortgage broker they will take care of this step for you, or if you are organising your mortgage directly with a bank/building society you just need to contact them and ask them to do it for you.
At this stage they will again want to check your financial details, and may ask you for bank statements for the period between your initial approval in principle and now. It took about 4 working days for us, which I believe is normal. However it can take a little longer so allow about 2 weeks.
You will be sent a copy, and your solicitor will also be sent a copy. It is quite a big document, but it is well worth reading through it all to be sure you know what you are getting. Your solicitor or mortgage broker should be able to answer any questions you have.
The copy your solicitor receives will ask them to proceed with the legal formalities and will usually give you 30 days to do so. Hopefully your contracts will arrive about the same time as your letter of offer.
Tuesday, March 4, 2008
Step 11 - valuation
So, you have got your engineers report back and it says everything is above board. Well done! You are well on the way. Maybe it brought up a few small issues - if so you can consider going back to the vendor (seller) and seeing if you can wrangle a better deal.
Next step, when you have informed your mortgage broker or building society is for a valuation to be done. This costs an average of €150 to be done and they will have a list of valuers available (they will generally select one themselves). These can be auctioneers in the area, or engineers, so do not be surprised if it is someone you have already had dealings with. Prices actually vary here, so if it is possible you can try to get a few quotes. We paid €130, but got a different quote of €180 so there is definitely a bit of difference in the prices you can get.
There is very little for you to do in this step. Provide the mortgage broker with the selling auctioneers details (or if it is a person selling directly their details) and they will sort out a time to do it. Generally this takes up to a week. This is very important as it tells the mortgage people that the house is worth what you have said it is - making sure their money is safe!
When this is done, the valuer will send the valuation to your mortgage people and they will let you know. At that stage they will start the process of moving your approval in principle to be a formal offer.
Don't keep contacting your Solicitor
When you are sale agreed (if not beforehand too) you will be in contact with your solicitor. This is an essential part of the process, but you should try to cover as much ground every time you are in contact.
Solicitor costs are one of the big costs of buying a house, so it is important to keep them as small as possible, and you will be charged fro EVERYTHING they do - be it a photocopy of a document, or sending you an email. For me, working in IT I am used to sending and receiving hundreds of emails every day, so would tend to send them without thinking. Until I realised that each individual reply I get I will be charged for.
Now, by this I am not suggesting you don't make proper contact, just that if you are mailing to tell them the sale is agreed, maybe include the contents list in the same mail, the engineers report if you have it already, and maybe the auctioneers details or the vendors details - basically, whatever info you have at hand. The more concise and detailed you are the less communication needed and so the less costs incurred.
Also remember the solicitor is working for you - so get them to do what you want, but at the same time, be sure to tell them all you want done as many will not take it upon themselves to do so without being told.
Solicitor costs are one of the big costs of buying a house, so it is important to keep them as small as possible, and you will be charged fro EVERYTHING they do - be it a photocopy of a document, or sending you an email. For me, working in IT I am used to sending and receiving hundreds of emails every day, so would tend to send them without thinking. Until I realised that each individual reply I get I will be charged for.
Now, by this I am not suggesting you don't make proper contact, just that if you are mailing to tell them the sale is agreed, maybe include the contents list in the same mail, the engineers report if you have it already, and maybe the auctioneers details or the vendors details - basically, whatever info you have at hand. The more concise and detailed you are the less communication needed and so the less costs incurred.
Also remember the solicitor is working for you - so get them to do what you want, but at the same time, be sure to tell them all you want done as many will not take it upon themselves to do so without being told.
Thursday, February 28, 2008
Details for auctioneer when sale agreed
When you reach an agreement on a price with the vendor (people selling - although you usually negotiate with the auctioneer and don't actually negotiate with the seller directly) you then need to provide the auctioneer with some details:
1. A cheque for the deposit (some take a bank transfer or bank draft but mostly it will be a cheque. You should send this by registered post, unless you can easily deliver it in person.
2. Give the auctioneer your full name(s) for contracts. This is important especially if you have an abbreviated first name (Joe = Joseph) or a hard to spell surname. I'm sure you get the idea! This can speed up the contracts.
3. Your current address.
4. Your solicitors details.
Then you should get an engineers report done and inform your bank or mortgage broker that you have agreed a sale.
1. A cheque for the deposit (some take a bank transfer or bank draft but mostly it will be a cheque. You should send this by registered post, unless you can easily deliver it in person.
2. Give the auctioneer your full name(s) for contracts. This is important especially if you have an abbreviated first name (Joe = Joseph) or a hard to spell surname. I'm sure you get the idea! This can speed up the contracts.
3. Your current address.
4. Your solicitors details.
Then you should get an engineers report done and inform your bank or mortgage broker that you have agreed a sale.
Monday, February 25, 2008
View 'em all!
We took another trip down to the West, and were blessed with some excellent Sun for the 5 days. Over 4 days (no viewings on Sundays) we managed to squeeze in 14 viewings.
Phew! Bloody exhausting.
But I would recommend strongly doing the same, especially if you are buying in a different location to where you are based. For us, it was getting very tiring to go up and down from Dublin to Galway every weekend or two, to see one or two new places, so we build up a load and made a proper, trip out of it.
What should you do if you are viewing a load of places?
- Print out everything you can get on each place. You may not be near a computer/printer while viewing.
- Staple it together (you'd be surprised how many sheets of paper are now floating around the back of my car!).
- Staple a list of questions and feedback space to each. We did a standard set and photocopied for each viewing.
- Space the viewings so you have about half an hour to sit, think and discuss each one - but still allowing yourself enough time to drive the distance between viewings.
- Draw a floor plan after the viewing and fill out your notes on each one before the next. It may seem fresh in your mind but after 5 in a day they soon start to merge together!
- See them all. I can't emphasize this enough. We thought we had decided after the first two, but changed our minds on the last day when we saw an unexpected last house on the last morning and decided we loved that more than any of the others.
- Don't rule the rest out if you decide on one. My next post will explain that one.
- Stay calm and if you are a couple buying together then remember you are a couple and don't get mad with each other because you are tired etc., as it is very very exhausting.
- Do spend the few quid to stay in a hotel as you need the rest and luxury to keep focused on the task at hand.
And best of luck with it!
Tuesday, February 12, 2008
Book early to view
We are planning a few days of looking at places to buy at the moment and one thing we have realised is that you can't turn around on a Wednesday and book to view that Saturday.
You'd think sellers would be falling over themselves to make it easy for you to view and possibly buy their houses, but in actual fact there are some places we have been trying to confirm bookings with for over a week now. So - if you want to make the most of your viewing time it is best to try to book well in advance.
For timing, we have also found the optimum timing is to make the bookings 1.5 hours apart (unless they are over 30 mins apart in distance). This allows an hour for viewing, which is a lot but you have to allow for the estate agent being late! Then it is good to have about 10 or 15 mins to write down your feelings and observations on the place, and answers you got for your questions. DO write this down immediately as there is nothing worse than spending a day viewing 3 or 4 places and finding that by the evening you can't remember which had that big bathroom or the smelly farmyard downwind.
Hope you find what you're looking for!
You'd think sellers would be falling over themselves to make it easy for you to view and possibly buy their houses, but in actual fact there are some places we have been trying to confirm bookings with for over a week now. So - if you want to make the most of your viewing time it is best to try to book well in advance.
For timing, we have also found the optimum timing is to make the bookings 1.5 hours apart (unless they are over 30 mins apart in distance). This allows an hour for viewing, which is a lot but you have to allow for the estate agent being late! Then it is good to have about 10 or 15 mins to write down your feelings and observations on the place, and answers you got for your questions. DO write this down immediately as there is nothing worse than spending a day viewing 3 or 4 places and finding that by the evening you can't remember which had that big bathroom or the smelly farmyard downwind.
Hope you find what you're looking for!
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