Mortgage Questions

Frequently asked mortgage questions and answers . . .

What other costs are involved when buying a house?

In addition to your mortgage, you should bear in mind the following one-off costs at the time or purchase (or remortgage if you are changing mortgage lenders):

• Legal fees: unless you intend to carry out your own conveyancing, you will need to pay a solicitor or other suitably qualified person to complete the legal work

• Land Registry fee: the Land Registry registers your ownership of the property

• Searches: your solicitor (or you) will need to check to see if there are any plans for the neighbourhood which could affect the value of your property, such as the building of a new road

• Survey and valuation: the lender will insist that a survey and valuation is done on the property. You should think about a more comprehensive survey to check for structural or other defects

• Stamp duty: all transfers of property of £120,001 or over attract stamp duty. For property transfers between £120,001 and £250,000 stamp duty is charged at 1% of the property price, for properties between £250,001 and £500,000 then the rate is 3%. The rate of Stamp duty for transfers of property over £500,000 is 4%.

STOP PRESS: In his Pre-Budget Report of 27 November the Chancellor of the Exchequer announced his Government's intention to implement the first phase of the stamp duty exemption relating to the purchase of property in certain designated disadvantaged areas of the UK, which will apply where the consideration, or premium for a lease, does not exceed £150,000. Relief will be available for all transfers of property in the designated areas with effect from 30th November 2001.