House Buying Fees
Many buyers under-estimate the total costs of buying a house, therefore we have put together some information as listed below.
Solicitor or Conveyancer Fees
A solicitor or licensed conveyancer will need to act for you in the purchase of your new house or flat. They will make all of the necessary legal requirements to transfer ownership of the property (house or flat) to you. Depending on the property price you should budget for fees of £600 – £1100 (often much less when you use Conveyancing Marketing services).
On top of this you will have to pay ‘disbursements’ which are paid to other organisations for local, environmental and water searches, and to the Land Registry who record your new ownership of the house.
Mortgage Fees
These are often charged by the lender for specific deals, such as fixed and tracker rates. These vary between £300 to £1,100 with more for some buy to let mortgages. Often the fee can be added to the loan and repaid over the life of the mortgage.
House Deposit
For many, especially first time buyers, this is the most difficult to find. In the past some lenders would consider lending the entire purchase price with a 100% mortgage, whilst others would offer up to 95% of the value of a home. Although lending conditions are easing slightly a deposit of 10% -15% of the purchase price will usually be required.
Stamp Duty Land Tax (SDLT)
This is a tax payable when buying any property costing more than £125,000 and is paid to HM Revenue & Customs by your Solicitor upon completion of the purchase. The cost is a percentage of the value falling within these bands: Up to £125,000 nil £125,000 – £250,000 1% (£1,250 – £2,500) £250,000 – £500,000 3% (£7,500 – £15,000) £500,000 – £1 million 4% (£20,000 – £40,000) £1 million+ 5% (50,000+)
Exceptions from SDLT
For properties located in ‘disadvantaged areas’ the starting threshold is £150,000.
Survey / Valuation Fees
All mortgaged property needs to be valued by an independent surveyor / valuer. A basic valuation report is needed by the lender, but a more detailed survey is often recommended for the buyer. Fees are usually on a sliding scale based on the valuation, from around £250 up to around £400 for a £300,000 property.
Mortgage / Financial Adviser Fees
The process of searching and applying for the most suitable mortgage is now much longer and more difficult than it used to be, and many mortgage advisers now make a charge for their professional services. Many also offer a choice of either a fee plus them keeping any commission received from the lender. Typical fees can be £200 – £700 where commission is receivable, or £1,100 – £1,400 where it is paid to you.
Additional security mortgage charge on the house
Where a lender grants a mortgage above a certain amount, often 75% of the valuation of the property, they are required to arrange for their own protection some ‘additional security’. This is usually an insurance policy which would make good any losses they suffered in the event of a repossession and sale, where the sale price does not cover the mortgage debt.
The total costs of buying a house will therefore vary depending on the price of the house and the above should only be taken as a rough guide.
If you find a cheaper conveyancing buying or selling house quote elsewhere please contact us and we will endeavour to better it. The majority of our online conveyancing solicitors will let you visit them if you wish although there is no need to do this. All the residential solicitors are checked by us to ensure their standards are acceptable. All our solicitors are registered with the Law Society. This means should you have an issues with the solicitor or be financial put a disadvantage they can step in to recover the situation. All payments are handled electronically by the property solicitor so you do not have to worry about your money. This means its much safer than it used to be because there is an electronic paper trail in place.