Before you purchase
Arrange a pre approval through your mortgage broker before you find a property to purchase. You will be able to find out exactly how much you can borrow, allowing you to set a suitable limit. Your broker can also advise you how much your new home loan will cost you on a weekly / monthly basis (helping you to budget). By organising your finances you will be well positioned to commit to a purchase, either by bidding at an auction or negotiating a private sale.
Have your solicitor review the contract prior to signing. This is particularly important when special conditions apply. Most solicitors will do this as part of their professional service.
When you have found the ‘right property’ and are ready to enter into a contract to purchase, insert into the contract appropriate ‘subject to’ clauses. Ensure time frames for these clauses are realistic, ie. a minimum 14 days for finance approval (even if you have pre approval), building and pest inspections, and at least a further 14 - 21 days after this till settlement. Remember Public Holidays will impact on the available time.
If you are purchasing using existing property equity, your broker should have advised you that the mortgage provider may not require a valuation to be done (on the purchase property). You may wish to instruct a valuer of your choice to ensure you have negotiated a fair market price (at your cost).
Insurance cover is the responsibility of the purchaser from the time the contract comes into force. This is very important. The mortgagee’s interest may need to be noted on the insurance cover note, confirm these details with your mortgage broker.
Make certain all ‘subject to’ clauses are met to your satisfaction. Your mortgage broker will advise you and your solicitor of the finance approval. Once your solicitor advises the sellers solicitor that all clauses have been met satisfactorily, then the contract is unconditional (almost time to open the Champagne).
Keep in contact with your solicitor, make certain all is in order at least 5 working days before settlement is due. Do not assume that all is ok if you haven’t heard anything – it can be a very costly error if the settlement has to be postponed.
When all is said and done….. it often isn’t. Make sure your bank account details are up to date. Ensure that any new arrangements are in place and working in readiness for the first repayment to take place.
Now is the time for the Champagne……..Enjoy your new home!!