What are you really looking for ?
You may want to move for a number of reasons. Living with parents driving you mad, a change of job, starting a family or just wanting to get on the first rung of the property ladder.
It is important to be clear about your reason for moving. If your search is focused, it will make the rest of the process more straightforward. For example, if you are moving to start a family, you may want to be near schools and parks. Properties that do not offer these things can be ruled out. Make a list of essential criteria such as a garden, as well as the things that would be a bonus but are not as important, like off road parking.
If your search will include apartments or flats, then you will need to consider whether to buy a freehold or leasehold property. When you buy a house, you normally buy the freehold, which means that you purchase the land and all that stands on it. When you buy a flat, in most cases you acquire the leasehold, which means that you are buying the right to live in the property for the length of the lease. Most leases start with either 99 or 125 years to run, but occasionally will be as long as 999 years. These are unusual and offer a great benefit over those properties with shorter leases. Although freeholders have to extend leases at the request of the leaseholder, there is not a limit to what they can charge to do so. For example, a lease with 60 years left to expire can cost between £3,000 and £12,000 to extend to full 99 or 125 year term. Take this into consideration when enquiring about any leasehold properties. Most mortgage providers, and indeed any good solicitor, will recommend an extension if the lease falls below 75 years.
Worthing is unusual in as much as the town has many freehold flats. This basically means that there is no lease set up because there is no separate freeholder that owns the land and/or building. In most cases, each freeholder is responsible for their flat and therefore their part of the building whether it forms part of a converted house or purpose built block. As there generally won't be a maintenance charge, there should be a ‘deed of covenant' in place to ensure each resident maintains their part of the building, amongst other issues.
You should check this information at point of enquiry. Provided the set-up is acceptable, freehold flats can prove good alternatives to that of leasehold. Do be aware, however, that if you decide to purchase such a property, you will be restricted on your choice of mortgage, as not all lenders will lend on them.
Once you are sure about why you are moving, you can think about location and the type of property you would like to buy. Do you have a specific area in mind or does finding the right style of property matter more? Think about how your lifestyle could change over the next few years and consider how this might affect your criteria in the future.
Once you start your search, you will quickly realize the kind of prices you can expect to pay. Your next step is to work out what you can afford.
Most people use a combination of a mortgage and deposit to buy their home. The deposit is typically between 5% and 10% of the purchase price. If you don't have the money for a deposit you will have to think about a 100% mortgage.
There are a number of different mortgages available to choose from. It can be confusing if you are not familiar with them all. When you are thinking about what kind of mortgage you should have, find out the cost of your monthly repayments and confirm the period you have to repay them. We will be happy to discuss some alternatives. A different type of mortgage and/or a longer term could reduce the monthly repayments. It is very important that you don't overstretch yourself, as you'll need to be prepared for interest rates going up.
If you're not sure about how much you can afford, our mortgage advisors are here to assist and help you work it out.
These are the main types of mortgages:
Fixed rate – interest rates are fixed for a set period, often three years, then revert back to the standard variable rate when the fixed rate period is over.
Capped rate – payments can't rise above a certain level for a fixed period of time – even if interest rates rise – but they can go down if rates fall.
Discounted rate – your mortgage is offered at a discount for a certain period.
Variable rate – payments go up or down in line with general interest rates.
There are three main ways of repaying your mortgage:
Repayment mortgage – where the loan in repaid by regular monthly instalments along with interest.
Interest-only mortgage – in this case only the interest on the loan is repaid. You will need to make separate arrangements to make sure you can repay the loan.
Investment-backed mortgage – where the loan is repaid by the proceeds of an investment.
Click here to go to our specific mortgage advice page.