Everything I Wish I’d Known About Buying A House
Some words that I didn’t think would ever spill out of my millennial mouth: I bought a house last year. But here I am, sat in a house that I bought.
After a move abroad fell through due to about 8,000 different things conspiring against us, my boyfriend and I decided that seeing as we’d banged on so much about how we’d miss our current city (Manchester), we may as well put the money we’d saved towards buying a house here instead. We were determined to do it entirely on our own without a single parental penny or a move back home. That unhelpfully stubborn mentality also meant that we navigated the entire process without any real guidance either. And let me tell you, it was the opposite of fun.
People love to say how stressful buying a house is. And I loved to ignore them. I was busy imagining swooning at hardwood floors and pretending to know stuff about boilers. I didn’t want to hear about ‘processes’ and ‘reality’.
But not only should I have listened, I also should have asked them: “What specific things were particularly stressful and how exactly did you resolve them?” Because the house-buying process is seemingly designed with two purposes in mind: 1) To let as many people have a slice of the pie as possible, and 2) To make you feel stupid, angry and anxious.
Fortunately, I came out the other side with a house that I love and only a mild contempt for solicitors. Here’s what I learned along the way…
Save More Than Your Deposit
1. Save more than your 10% deposit
10%, 10%, 10%. That’s the goal. Scrape 10% together and you’re on your way to home ownership! But to avoid panicked borrowing down the line, you should aim for more than 10%. A very competitive market and a few disappointments along the way meant that the whole thing took much longer than we expected and we ended up saving double what we’d intended. We still spent nearly every penny.
10% is the absolute minimum you need. You also have to account for solicitor’s fees, survey costs, transfer fees, valuation fees, mortgage arrangement fees, building or decorating costs and moving. That all might sound a little daunting but remember, if you’ve managed to organise your finances to save 10%, you’re more than capable of topping it up to cover the rest. Just give yourself time.
A Landline Improves Your Credit Rating
2. Having a landline improves your credit rating
All sorts of things can affect your credit rating and, weirdly, having a landline is one of them. Being on the electoral register is another.
Before you embark on the whole process, do some credit spring cleaning. Close any dormant joint bank accounts that you used to have with uni flatmates and check you don’t have any shared financial products with someone who might have a bad credit rating. Set up direct debits to avoid any late payments and, if you can, avoid making any credit applications right before you start the house-buying process as they can make a dent in your credit score.
It’s Okay If You Earn Below The Student Debt Threshold
3. Not earning enough to repay your student debt can actually be a good thing
For the two years my most recent accounts covered, I hadn’t even earned enough to reach the student loan repayment threshold. Between us, my boyfriend and I were making about as much as one area manager. Luckily, we live a pretty simple life and put in a lot of extra hours to save but I really thought that would be the thing to thwart the whole plan.
Turns out not. We had the savings, we had good credit ratings and we were able to show we could afford our mortgage repayments. And the best part? When I revealed I hadn’t yet hit the threshold to repay my student loans, I was told it was a good thing because it was one less outgoing to take into account. Don’t talk yourself out of it before you’ve even begun.
Switch Back To Paper Billing
4. You should switch back to paper billing right this second
This advice is so un-eco friendly it makes my skin crawl but you’re going to have to do it. Solicitors, lenders, estate agents, insurers…these people want Every. Single. Thing. On paper. And no, the one you printed from your online account isn’t always good enough, apparently.
Even though by the end, you’ll speak to most of these people more than your own family, it’s all about proving that you are who you say you are. And rather than, say, showing them screenshots or printouts from an app with vigorous security measures, they’ve decided that you need to provide a letter. A letter that you could have very easily pinched off someone else’s doorstep.
It’s backwards and frustrating but it’s not worth expending the energy fighting it. So switch back to paper billing, save everything in a box file and go and plant a few trees once you’ve got your keys to say sorry to Mother Earth.
The Process Is Harder For Freelancers
5. Being freelance throws up extra hurdles (but doesn’t make it impossible)
Being freelance was a thorn in my side throughout the entire mortgage application process. My boyfriend has a salaried position, so all he had to do was show a couple of payslips and his contract stipulating his salary.
I, meanwhile, had to provide what felt like endless accounts and proof of income. Thanks to the way the tax year falls, I couldn’t submit what was my best financial year ever. Instead all they had to go on were accounts from one of the worst professional years of my life and the following year, which only did a tiny amount of damage control. Some people along the way loved to make me feel about two feet tall because of it but, luckily, others were much more pragmatic and understanding.
The process is definitely harder for freelancers, there’s no doubt about it. However, it is absolutely doable if you keep on top of your accounts and are prepared to do some shopping around. Which leads me nicely onto my next point…
Get A Financial Adviser
6. Financial advisers aren’t just for rich people
I have a financial adviser. He’s called Richard and he sends me birthday cards that are almost certainly not signed by him personally. But I love him because were it not for him, I might just have given up and rented forever.
His insider knowledge and connections meant that being freelance was barely an issue after I took him on. And he got us an amazing mortgage rate that we hadn’t found anywhere else. And he’ll renegotiate another great one after five years. And he sorted our insurance. And he was free!
Financial advisers often work on commission, meaning you won’t actually pay them a penny but you’ll get all of their expertise and advice. Do yourself a favour, shop around and save yourself a lot of stress.
Wait For The Best Deal
7. Don’t be tempted to rush into the first mortgage offer you receive
The first mortgage offer we received was bad. Just awful. They wanted a 15% deposit, offered an appalling interest rate and demanded we bring our first born directly into branch upon its arrival. And yet, we were tempted. We thought all offers must be broadly the same and we were feeling the heat from the regular ‘check up’ calls from the bank.
However, we sat tight and shopped around. Well, Richard the financial adviser did, and a few weeks later we had a deal that was much more achievable. All mortgage offers are not created equal.
Get A Help To Buy ISA
8. You should absolutely get a Help to Buy ISA
I didn’t and it was stupid. I kept putting off opening one and ended up losing out on £3,000 of sweet government money. £6,000 really, because you can have one each. Open a Help to Buy ISA. Do it now.
Solicitors Work For You
9. Solicitors work for you, not the other way around
Of course, technically I knew that I was the client and they were the service provider but, hoo boy, do they like to make it feel like it’s the other way around. For the sake of your sanity, establish boundaries and expectations with your solicitor early on otherwise you’ll end up apologising for not sending paperwork that you absolutely, 100% know they didn’t ask for in the first place.
You’re forking out a significant sum, so you’re entitled to ask for updates and speak up when things are taking too long. Incompetence on the solicitor’s side almost cost me and my boyfriend our house, so take it from me, it’s in your interest to keep on top of them.
House Viewing Is Not As Fun As You Would Expect
10. House hunting stops feeling like Location, Location, Location after viewing exactly four houses
“OMG, it’s going to be like Kirstie and Phil!” you think. And it is, until it’s not. I soon learned why the estate agent gave me a pitying look when I told her how excited I was to view houses.
At first it’s exciting, snooping round strangers’ houses and imagining where your sofa will go. But it gets old pretty quickly. It’s a treadmill of looking, nodding and politely pretending you’re not going to rip out every single fitting the second the sold sign comes down.
If you’re lucky enough to experience the hell wonder that is group viewings, you’ll also start to see the same people each week. You’ll recognise that tired look in their eyes, the twitchy reaction when a wall looks damp or a light switch doesn’t work. You’ll exchange smiles, ask how it’s going and then walk off secretly hating them for daring to potentially outbid you.
BUT even when you’re on your 17th house that month, that excited feeling in your stomach when you walk through the door of a place you might just love definitely doesn’t go away. Hold onto it.
Originally published at https://refinery29.com.
