Get your finances in order

Before applying for a mortgage, it’s best to spend time closely monitoring your finances to prep your bank account for the financial assessment. Your credit score plays a key role in how mortgage lenders will assess your application. If you have lots of lines of credit open to you such as credit cards, it’s best to close any inactive ones and lower spend limits on ones you are using so a mortgage lender feels reassured you can’t suddenly get into a lot of debt. You can check your credit score in advance through a free service such as Money Saving Expert, and get advice on how to repair any historical damage that may hold you back.

Speak to a mortgage advisor

We can help you with this, so have a chat with us first. A qualified mortgage advisor will be able to tell how much you’ll likely be able to borrow, based on your current income and expenditure. That way, you’ll have a better idea of your budget before going to look at new homes. It can also help to have a mortgage agreement in principle (AIP) before you start house-hunting, particularly if you’re a first-time buyer. This is a document from a mortgage lender to show they have assessed you and confirmed the amount they are willing to lend you ‘in principle’, ahead of your actual application, which proves to the developer that you’ll be able to afford the property. 

The search begins!

The next step is to find a development that suits you. Consider where you want to live, do you want to be close to town, by the sea or somewhere more rural? What amenities and travel routes are important to you? Once you have a clear picture of your dream location, you can begin to enquire with new-build developments in the area. You will be contacted by a dedicated sales consultant who will provide you with all the information you need, such as a brochure and price list to help you narrow your search to the house types that suit you. Once you have an idea of what you want, you’ll be able to visit the development and potentially view a show home or empty property if they’ve already been built. Alternatively, you can view where the house type you wants will fall on a map to help you make a reservation.

Check your buying options

If you’re a first-time buyer, there may be a number of buying options available to you on the development based on your income and affordability. For example, if the home you really want is a little outside of your price range, there may be the option to purchase it through shared ownership. This means you buy a share of the property, for example 50%, where the purchase price of your home would become 50% of its full value. If you paid a 5% deposit on your 50% share, you would only need a mortgage on 45% of the property purchase price, rather than 95%. For the 50% you don’t own, you pay an affordable rent to a housing association. With such a small mortgage and rent payment, your total costs work out at a really affordable price, and you’re able to keep buying additional shares as and when you can afford it until you own your home 100%. Read more about the shared ownership eligibility criteria.

Reserve your home

Once you’ve found your dream home and are confident you can afford the monthly payments, it’s time to reserve it. You’ll need to pay a reservation fee, which typically ranges from £300 to £1,000 and will be deducted from the purchase price when you complete. This fee is non-refundable if you decide to pull out, so make sure you are sure before taking the plunge!

Start the paperwork

You’ll need to officially apply for your mortgage once your purchase price and property choice are confirmed. The mortgage lender will have the property independently valued and confirm they are willing to lend you the money to buy it. You’ll also need to appoint a conveyancer or solicitor to manage the legal part of your purchase. You may want to find one with experience of dealing with new- builds due to the extra checks that are needed – such as planning permission and that the estate has access to things like gas, phone lines, roads and sewers. They’ll also negotiate the date you can get your keys and manage the transfer of funds to buy your home.

Wait for the big day

The hardest part of buying a new-build is often the wait! There are a lot of dependencies and factors that can delay a construction site. Take reassurance the developer wants your home to be completed as soon as you do, and will be doing everything in their power to reduce any potential delays. You’ll exchange contracts months before you are actually able to move in, which is when you will pay your deposit. You’ll be given an estimated date when the developer expects your home to be complete, and a date the build has to be completed by. Target completion dates can often move, so the long-stop date offers some protection that your mortgage offer doesn’t expire.

Move in

It’s finally time to get your keys! Your sales consultant will meet you at your new home to welcome you and give you a demonstration of everything you need to know, such as how your heating works and how to connect your internet. They’ll also leave you with a home user guide with advice on how to manage your new-build home and useful contacts for your gas, electric and water suppliers. Then it’s time to unpack, before putting your feet up to relax and enjoy your new home.