First Time Buyer's Bible

We are an independent, family-run estate agents, based in Ealing. Our team of property professionals are experienced in sales, lettings, block management and conveyancing. We have our own in-house financial services and conveyancing departments, so you can find the answers to all of your questions under one roof. We are passionate about property, but don't just take our word for it - come and visit us at our office in West Ealing, or give us a call on 020 8998 1118 to discuss your property requirements. Your property, our priority. Address: 23 The Avenue West Ealing London W13 8JR 020 8998 1118 enquiries@castlehillproperties.co.uk www.castlehillproperties.co.uk visit our facebook page and 'like' us!

This handbook is a guide only. It is not intended as a comprehensive buying reference.

First Buy equity loans

To Buy or Not to Buy?

Buying a property is one of the biggest financial decisions you will ever make in your life. It can be a daunting and confusing experience, particularly for first time buyers, which is why it is important to have an understanding of the process and what is involved. The First Time Buyer's Bible will guide you through the buying process, stepby-step and explain how it works. We have also included some useful hints and tips, to save you time and money, as you take your first step onto the property ladder.

With a First Buy equity loan, you buy your home with at least 80% of the cost met by a mortgage and a deposit. The rest is paid for by the government and the house builder through an equity loan. The home will be in your name, which means you can sell it at any time. The government and the house builder will get a share of the value when you sell your home. If you dont sell your home, youll have to pay back the equity loan after 25 years. Shared ownership scheme Shared ownership schemes are provided through housing associations. You buy a share of your home (between 25% and 75% of the homes value) and pay rent on the remaining share. Youll need to take out a mortgage to pay for your share of the homes purchase price. NewBuy NewBuy lets you buy a newly built home with a deposit of only 5% of the purchase price. To qualify for NewBuy, your new home must be: New build being sold for the first time (priced 500,000 or less) Your main home Owned fully by you Built by a builder taking part in the scheme

Home Ownership Schemes

If you want to buy, but can't afford to go it alone, there are still options; Buy with someone else: This is known as a 'joint' mortgage and can make the buying process easier. For example, buying with parents, friends or a partner. Tenants in common: This means you jointly own the property, but you own a share of the value, which you can give away, sell or leave to someone in your will. The Government have also introduced three home ownership schemes, to help first time buyers

1.

Budgeting
Stamp Duty: Stamp duty is a tax, charged for properties above 125,001. If your new home is priced between 125,001 and 250,001, you will pay 1% of the property price. From 250,001 to 500,001, it will be 3% and over 500,001 it will be 4% Removal Fees: Ask for quotes from at least 3 different removal firms, as prices vary.

So, you have decided to buy a property, but exactly how much can you afford? You will need to take a good look at your finances in order to work out what you can comfortably afford to pay. The easiest way to do this is by creating a budget planner. This should account for all of your income and expenditure, over the course of a month. (We have included a sample budget planner at the back of the bible). There are some additional costs to take into account at the beginning of the buying process;

2.

Deposits

2.

Lender's Valuation (Basic Valuation): All lenders require a valuation of the property to check that it is worth the price being paid for it. Legal/Conveyancing Fees: You will need to hire a solicitor to deal with the legal aspects of buying a property: Authority Search Fees: Local searches will be carried out by your solicitor/conveyancer to ensure that there are no potential problems, such as planning permission on neighbouring properties or plans for new roads nearby. Other Search Fees: These include index map, commons, the coal authority, land charge, company searches, bank transfer fees.

You will usually need to put a substantial amount down as a deposit. Ideally, you should try to put down at least 15 per cent of the value of the property as a deposit, and more if possible. However, some mortgage companies, (particularly localised building societies that haven't been too affected by the recent banking disaster), are now offering mortgages and in return for 5 to 10% deposits, but typically, the lower the deposit requirements, the higher the interest rate. .

3.

Mortgages

What are the different types of mortgages? When deciding which mortgage to go for, there are two main things to consider; . 1. Will you opt for a capital repayment or interest-only mortgage? With an interest-only mortgage, the payment you make each month comprises just of the interest you owe for that month. So you are not paying off any of the capital. With a capital repayment mortgage, your monthly repayment consists of the interest you owe, plus a percentage of the capital. 2. What kind of interest rate will you pay? There are a number of options as far as interest rates are concerned. You can choose a 'fixed-rate' mortgage, (a fixed price over a number of years), a 'tracker' rate, (which can be capped) and the interest fluctuates with the Base Rate. The tracker rate can go down but it wont go up above a certain level. On the next page, we have attached a mortgage budget planner, so you can start budgeting for the various costs associated with buying a property.

Before looking at properties, you should always consult an independent, whole of market mortgage adviser, to find out what your maximum possible loan could be. This will be based on the size of your deposit and how much you earn. Lenders will usually lend up to three times the size of your annual income, although some will lend up to four times your income. If you are buying as a couple, this increases to either three times the first income plus one year of the second income, or two-and-a-half times your joint income.

2.

See the Mortgage Clinic page at the back of the Bible for more information.

Book an appointment with our inhouse financial adviser at our weekly 'Mortgage Clinic'. The adviser will help you get your finances in order, work out a budget and find the best mortgage deal for you.

Mortgage Budget Planner

MONTHLY INCOME Monthly Salary (after tax)

Other Monthly Income

TOTAL MONTHLY INCOME

MONTHLY EXPENDITURE

Credit Card Payments Gas Water

Electricity Telephone (Landline) Telephone (Mobile) Council Tax Food Bill Clothing/Footwear Car Tax/MOT Car Insurance Car Maintenance Petrol Commuting/Travel Costs Life Assurance Premiums Regular Savings & Pensions Loan Repayments Other Standing Orders & Direct Debits Home Maintenance Socialising/Entertainment Any Other Expenses TOTAL MONTHLY EXPENSES

4.

The Search
Another sign of a good area to invest in is one with a lot of interest from property developers. Find out if any new flats and homes are being built. Local newspapers and council websites are a good source of information about planning activity. Leasehold v Freehold All properties in England and Wales are either freehold or leasehold. Freehold means that you fully own the property. As a freeholder you will have full responsibility for the maintenance and repairs of the property. If you own a leasehold property, you only own it for a fixed period of time. Youll have a legal agreement with the landlord, called a lease. This tells you how many years youll own the property. When the lease comes to an end, ownership of the property returns to the landlord. Leases can be extended, but the shorter the lease, the higher the cost of extending it. Most flats are leasehold. Houses can be leasehold too and usually are if theyre bought through a shared ownership scheme.

Looking for a new home is a timeconsuming process and it is tempting just to rush into buying the first one you like the look of. But once you have decided to buy a house and found out how much you can afford, it is worth sitting down and thinking about what you want from your new home and what your needs are. We have made a list of some of the things you should consider: Style of Property: Do you want a brand new build or a period property? Does it matter whether it is terraced, semidetached or detached? location, location: It is important to research the neighbourhood you want to live in before viewing lots of homes or making an offer. It is also worth doing two viewings; one during the day and one at night and maybe one during rush hour. Amenities: Check out the schools, leisure facilities, parks, activities for kids, shops, public transport and so on. Commute: Is the location convenient for your commute to work? It is also useful to keep abreast of market trends in the area you want to buy in. Gentrification is a key indicator of an area which is improving and where house prices are more likely to go up. Key signs of gentrification include an abundance of cafs and trendy home design shops.

2. Location,

Reasons to buy in Ealing

Ealing, (also known as Queen of the suburbs,) is the third largest borough in London and the forth most ethnically diverse borough in the country in terms of sheer number. Attractions Ealing is home to the world famous 'Ealing Studios', which is the oldest continuously working studio facility for film production in the world. Pitshanger Manor Gallery & House is Ealing's flagship cultural venue and comprises of the Grade I listed Pitzhanger Manor-House, designed by the architect John Soane in 1800 and PM Gallery, which is West London's premier professional contemporary arts venue. Questors Theatre is the largest community theatre in Europe. Parks Ealing has ten key parks, which are generally the largest and most used sites in the borough. Walpole Park is Ealing's premire park. It hosts the annual Ealing Summer Festival, which comprises of Comedy, Jazz, Blues, Opera and World Music. The festival attracts thousands of visitors each year and entry is just 1. Schools Ealing has 91 state-run schools and nurseries, with a number of schools attaining 'outstanding' or 'good' Ofsted ratings in 2012.

Outstanding Primary Schools Christ the Saviour C of E Primary School Springbridge Road New Broadway Ealing W5 2XA Montpelier Primary School Montpelier Road Ealing W5 2QT Outstanding High Schools/Sixth Form Colleges Twyford Church of England High School Twyford Crescent Acton London W3 9PP Transportation Ealing has good tube links, being located on the central and district lines. The Piccadilly line is served by nearby Ealing Common, Northfields or Boston Manor Station. The new high speed 'Crossrail' link will further improve transport connections to and from Ealing, but will also make Ealing a much more desirable location to invest in property. A number of major bus routes pass through Ealing (207, 65) and there are plenty of smaller routes connecting Ealing to the surrounding boroughs.

5.

Making An Offer

To make an offer, you will need to get in touch with the sellers estate agent and tell them how much you would like to offer for the property. If they dont accept, you can increase your offer, but make sure you dont pay more than you can afford. The selling agent has an obligation to inform the seller of all offers, in writing, within 24 hours, except those which the seller has instructed the estate agent not to be passed on. For example, offers below a certain price.

The buyer's solicitor will then perform the relevant searches against the contract and the buyer will have the opportunity to raise any issues and concerns. i.e. when was the boiler last serviced? The solicitor also has a legal obligation to the lender and will raise questions and searches on their behalf too. Most people hire a solicitor or licensed conveyancer to undertake the legal side of buying their home.

We have a highly experienced, in-house conveyancing team, who can manage this for you. See our conveyancing table on the next page to get an idea of what's involved.

6.

Conveyancing

The term 'Conveyancing' refers to all the legal and administrative work associated with transferring the ownership of land or buildings from one owner to another. The conveyancing process starts after an offer has been made and accepted. Once an offer has been accepted, a memorandum of sale (MOS) is sent to all parties associated with the sale and purchase. Once the seller's solicitor has the MOS, they will put together a draft contract and send it to the buyer's solicitor.

7.

Exchange

8.

Completion

At the point of exchange, you will hand over a security deposit which is nonrefundable if you pull out of the sale. This is normally 10% per cent of the purchase price. You will then sign a copy of the contract, which is passed to the seller, and the seller signs a copy of the same contract which you receive. Once contracts have been exchanged between both solicitors, both parties are legally bound to follow through with the transaction. You can no longer change your mind. Your solicitor will deal with the finalisation and signing of documentation relating to your mortgage, and will arrange for the money to be available on completion of the sale. Land Registry checks will then be carried out by your solicitor, to make sure that nothing is registered against the seller, such as undisclosed mortgages or unresolved disputes. There will be various matters for you to deal with in the run-up to completion. There will be some documents to be signed and payments to be made and before completion, you need to make sure that all the terms of the contract have been fulfilled, such as any repairs. At this stage, you also need to be arranging all the practical matters related to moving house.

On the day of completion, you will receive the keys once the sellers solicitors have instructed the selling agent. This normally takes place around midday. The seller is then obliged to move out. You will pay the seller the balance of the house through your solicitors and you will be given the transfer document. After completion, there will be some admin for you to tie up and then your solicitor will; Inform your mortgage lender, life insurance company, and the freeholder that the sale has been completed Register the transfer of ownership at the Land Registry. Send the deeds to your mortgage lender who will keep them until you either sell the property or pay off your mortgage Pay the stamp duty Send you a statement of completion, including a summary of the financial transactions. (If you have not already paid their fees, they will ask for these now). Congratulations, you've just bought your first home!

After the move

At Castle Hill, we care about what happens to our customers after the sale. Whether you need a builder, a plumber, a gardener or an interior designer, we have an extensive list of local, recommended suppliers from within the property industry on hand to help. Call us on 020 8998 1118 to discuss your requirements. AC Builders: specialise in extensions, lofts, garages, basement conversions and refurbishments. Avenue Interiors: is a new kind of dynamic interior design company. We offer hardwood flooring including sanding and restoring floors, all types of curtains and blinds made to measure, as well as all other aspects of professional interior design. Caro Garden Design: offers a range of services, from garden redesign to working out planting schemes and garden maintenance. Charles Derby: provide services to help you improve your financial plans in every aspect of your life. We have a dedicated mortgage team, who run a weekly mortgage clinic at the Castle Hill office, where our expert adviser will deliver financial information, advice and solutions, which are clear and easy to understand. Ealing Property Services: offer reliable and professional property maintenance services for commercial and private buildings. Services include; complete painting and decorating, wallpapering, carpentry, rewiring and electrical work, plumbing, tiling, water leak damage repairs, tile repairs, window repairs, door repairs Speed Removals: specialise in house removals, office removals, furniture removals and storage, as well as providing a comprehensive packing service. Utility Bill Management: Castle Hill can organise it so you receive all your monthly utility bills in one single bill, saving you time and energy paying bills to different suppliers. You are also guaranteed to save money. The single monthly bill encompasses electricity, gas, broadband, mobile phone and land-line costs. Call us to find out more. VR & Shaw Solicitors: can take care of the legal administration and paperwork for your purchase, so you don't have to. .

FREE
MORTGAGE CLINIC

Want some free, impartial mortgage advice?

Book an appointment with our in-house financial adviser, from Charles Derby Wealth. Mortgages can be tricky to arrange and can involve a lot of paperwork. Charles Derby are experts in researching and arranging mortgages for all sorts of people. With access to a huge range range of providers from across the market and with unique deals available, we aim to provide the best deals for our clients, regardless of their circumstances.

Clinic Hours
Thursday Evenings: 18:00 20:15 Saturday Mornings: 9.30 11.45
Book your free appointment today! Call us on 020 8998 1118 or email us at enquiries@castlehillproperties.co.uk (Appointments last 45 minutes)