Watch Out for Hidden Costs

Added on September 1st 2017

Everyone knows that buying a property is expensive, but there are loads of other expenses that first-timers might be blind-sided by, so here’s a useful checklist of hidden (or, at least, not well known to newbies) expenses.

The Stamp Duty

This is the tax that is levied on homes that cost more than £125,000 and it must be paid within 30 days of the transaction completing. The current rates are 0% on homes under £125,000; 2% for homes costing £125,001-£250,000 and 5% on homes costing £250,001-£925,000.

The valuation fees

Your mortgage provider will want to value the property you’re asking to be mortgaged and this valuation usually costs between £150 and £1,500.

The legal fees

You need a solicitor to help with all the legal processes and their fees usually range from £900 to £1,500. Sometimes extra searches and documentation is needed so this will increase any costs further.

Electronic money transfer fees

This pays for the mortgage provider transferring the money over to the solicitor and it’s usually no more than £50.

The mortgage fees

You’ve already paid your deposit, but it’s not quite over yet as you need to pay a booking fee of between £100 and £250, an arrangement fee (this is often around £2,000 but you can sometimes add it to the mortgage balance) and a mortgage valuation fee (around £150).

Once you’re in…

There’ll be even more spending! There’s always something, from new light fittings, paint, a new fridge because your old one doesn’t fit… You’ll already have been told about any major repair work that’s needed, but you can guarantee there’ll be minor ones you didn’t know about as well.

Your insurance

You can’t get a mortgage without insuring the property, so you’ll need home insurance and also life insurance in case the worst happens before the mortgage is paid off.

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