What you need to know about buying a house
Buying a home is a big step and there can be a lot to consider. Here we run through the typical buying process you will go through when purchasing your new home.
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Sorting out your finances
The first step before buying a home is to ensure you have a deposit saved. Most lenders will require you to have a 20% deposit for your home loan. For example, if you wish to purchase a home worth $400,000, you would require an $80,000 deposit. However, most lenders have loan products to borrow up to 90% of the property value.
You may also like to create a budget to determine what you can realistically afford to spend on mortgage repayments.
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Mortgage calculator
Once you’ve worked out your budget, you can use a home loan repayment calculator to get an idea of what your mortgage repayments would be. Mortgage-express.co.nz has some useful tools you can use.
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Pre-approved finance
Approach lenders to get finance pre-approval so that you know what price range you can look at for your new home.
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Doing your research
Start to look at neighbourhoods that would suit your needs and your budget. A great place to start is online. There are lots of property comparison sites on the web which will give you an indication of the average sale price of houses, land and units in an area.
Also start attending open homes. Take advantage of an open home and use the time to perform a thorough property inspection.
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How to make a formal offer
The best way to make a formal offer and avoid any confusion is to make the offer in writing. A sales consultant will most often provide you with a contract to start the process which will also highlight any conditions of sale. The consultant will then present this offer to the sellers.
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After your offer is accepted
If your offer is accepted, and all parties have signed the contract you will be asked to pay a deposit. This usually equates to 10% of the purchase price.
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Selecting a solicitor or conveyancer
You will need to nominate a solicitor to act on your behalf once your offer has been accepted.
Final Steps…
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Property purchase costs
Financial fees vary greatly, depending on such matters as what percentage of the property value that you will be borrowing, the amount of the loan, the amount of the purchase and which bank you are borrowing funds from. If you speak to your local Harcourts Financial Services representative you can quickly ascertain approximate costs for your particular circumstances.
Possible expenses you may incur are:
Bank fees
Solicitor’s/conveyancing
charges may include legal searches (please consult your solicitor)
Home protection insurance
Miscellaneous costs (building inspection, rates, removalists, etc.)
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Completing the purchase
Before settlement your solicitor/conveyancer will undertake the necessary searches with respect to the property and your financier will prepare the mortgage documentation.
On settlement your solicitor will exchange with the seller's solicitor:
Monies
Transfer documentation
Keys to the property
Within a few days of settlement your solicitor or financier will register the necessary documentation and mortgage transfer with the Land Titles Registry.
Possession of the property usually takes place on the settlement day although the seller and buyer can agree for these dates to be different.
One of our team members will contact you to arrange a pre-settlement inspection. This is your opportunity to ensure all appliances at the property are in working order and that the property is as you recall from the time you signed the contract. If issues arise at this inspection, you should immediately contact your solicitor/conveyancer to postpone settlement until your concerns are addressed.