You have already bought your first home, now it is time to sell your old home and buy your new home at the same time.
The key to getting this right is to remain calm, think logically, keep going and try to not get too stressed. Make sure you keep an open dialogue with the buyer of your property and the seller of the one you want to purchase so that they feel assured that all is going to plan. If you have more than one person in your chain, try to get the contact details of everyone in your chain so you can keep it all together. This is easier than you think!
In order to have success in buying your new home, you need to make the old one appealing to a buyer.
Improve your chances of selling your home:
Click here for guidance on how to go about this.
Get your documentation in order (you will need the following):
- Copy of photographic ID (driving licence or passport)
- Current P60 (if employed)
- Last two years SA302 tax calculation (if self employed) from Inland Revenue
- Copy of your tax declaration (if self employed) from Inland Revenue
- Last three months pay slips
- Last three months bank statements
- Monthly expenditure form
Keep a list of the following handy:
- How much deposit you have.
- Your earnings.
- A copy of your credit report (if you do not have a good credit score, click here.)
- A figure for the costs associated with legal fees from a conveyancing Solicitor.
- A figure for Stamp Duty to be paid.
Now follow this guide:
1. Head to Zoopla. Enter your home address, select the refine tab to enter your properties details, then select either of the two options shown (estimate or agent valuation) to get your properties value. If you have carried out any home improvements, make sure you update this to reflect the current condition of your home. Print out a copy of the estimate.
2. Get a valuation for your property from at least three estate agents and the cost of the estate agent fees. Once you have all three sets of fees, negotiate the price down with each estate agent. Don’t be afraid to negotiate with everyone, estate agents, solicitors and insurance companies for your buildings and contents insurance.
3. Have a look online to get an idea of how much you want to spend on a new property.
4. Find a financial advisor or mortgage advisor (preferably one that doesn’t charge you and searches “whole of market”) to see what you can borrow/afford etc. Give them an approximate sale price of your current home and give them all three estate agent valuations. They will also need your Zoopla estimate of your properties worth, your earnings, monthly expenditure, any debts etc and an idea of what kind of property you want to purchase and the cost.
If you are doing this without an advisor, speak to the mortgage department of your current lender. They will go through the process with you to advise what you can afford (but remember, you don’t have to go with your current lender) for your new mortgage. Contact other lenders to see what offers they have until you feel you have found the right lender/cost of your new mortgage.
5. Obtain an EPC (Energy Performance Certificate) for the property you want to sell. An EPC will advise a potential buyer about the properties energy performance. To find a Domestic Energy Assessor click here. To retrieve an Energy Performance Certificate click here.
6. Find a buyer for your home first. If you are in a strong position, you can use that to negotiate a better purchase price on your new home. Once you have a buyer you can then find your new home.
7. Find a property you can afford. Ask the estate agent and/or seller questions about the property. Get a price for the property.
8. If you are purchasing a property that requires alterations or building works, now would be a good time to contact a builder to get an idea of much this would cost. Give these costs to your financial advisor/mortgage advisor or current lender to see if you can afford them or if you were considering adding these as additional borrowing to your mortgage.
9. Go back to your financial advisor or mortgage advisor or current lender, check again the price of the property, any building costs, whether you can afford the stamp duty, legal fees and that you have enough deposit. Is there an arrangement fee for the mortgage? How much is it and can you afford it? Check whether you want to pay this upfront or just have the lender add it to the mortgage.
10. Check with the buyer of your current home that they are still happy to go ahead with the purchase and the chain is still intact.
11. If all the figures work out and the chain is still intact make an offer on the new property.
12. Once accepted, your lender will want to view the property to ensure the amount borrowed reflects the actual condition of the property. This is known as a Valuation/Mortgage Valuation. If the lender advises they will not lend as the sale price does not reflect the condition and value of the property you can either pull out of the purchase or ask the seller to reduce the price accordingly.
13. Most people will now engage the services of a building surveyor who will view the property to provide you with a Building Survey/Home Buyers report. The report will confirm the value of the property and will pick up things like problems with electrics or whether the property will need a new roof etc. Once you have had a survey carried out, you can ask the seller to reduce the price if any issues arise. This is an invaluable asset when buying any property and worth spending money on. If further issues are raised in this report and the property requires further investigation, you will then need to engage the services of a Structural Engineer. The engineer will then provide you with a Building Inspection Report/Full Survey/Structural Survey. Again you will be able to negotiate the price of the property you are purchasing with this report if it does indeed require more work. If the property you are purchasing has a history of subsidence, you will need to look into the costs associated with subsidence insurance. If all issues are resolved, you are ready now ready to exchange contracts.
14. If at any time before you exchange contracts you feel that this is not right for you, you can always pull out of the purchase.
15. At this point gather all the email addresses of each buyer/seller in the chain (if you can) by asking the owner of the property you are about to purchase to give them to you. Then ask the seller for their solicitor’s email address. Generate one email with everyone copied in advising who you are, what property you are buying in the chain and what you have been advised your solicitors are waiting on from elsewhere in the chain. One of our members found this to be the best way of making sure everyone in the chain knew who or what was holding things up. It is quite an unusual way of making sure the chain pulls together to make everything go through on time. It can and does work and each person in the chain (except the solicitors) will thank you for it. The Solicitors will not respond and if they do, they will probably tell you to stop emailing them but the point is that everyone else in the chain will know where they stand and these emails encourage the actual people in the chain to respond to give their position. There will be no more “it is with the seller’s solicitors” or “we are just waiting on something from this buyer” etc. Everyone in the chain will know where the problem lies and any hold ups which should make the transition go much more smoothly.
16. You should now be in a position to set an exchange of contracts and completion date. Some people decide to exchange and complete on the same day and this is possible to request. You are now officially committed to the sale of your old home after the exchange of contracts. You may be asked to pay a holding deposit, but most sellers do not need that once contracts have been signed.
17. Completion date is set, now you should be looking into buildings and contents insurance for your property. You should also be advising utility companies of the moving date and packing your home for the move. For guidance on how to do this, click here.
18. Completion date has arrived! Keep in contact with your solicitor throughout the day (if the completion is set for a specific time) and be ready to leave the property at that specific time. Do not leave your buyers waiting for you to finish packing!
19. Congratulations on your move!
20. Your solicitor will register the property with the Land Registry for properties in England and Wales and you will receive the title deeds to your new home.
You should now look to reviewing your mortgage life insurance to take into consideration the change in cover you may now require.
If you are remortgaging to buy something for your property, you should now look to reviewing your buildings and contents insurance to take into consideration the change in cover you may now require.
You should now follow our when you move checklist and our everything you need to know when you move into your new home.