All About Buying Off-Plan

all-about-buying-off-plan
Added on February 11th 2019

You may have heard of buying off-plan, but dismissed the idea immediately as you think it’s for developers and people with lots of experience in the property market. It’s actually a lot easier than you might imagine and it can work out really well. Here’s how to do it.

Speak to a financial advisor first

When you’re buying off-plan you can’t get a mortgage offer until (usually) six months before you complete the sale. Your advisor will be able to guesstimate how much you’ll be able to borrow once you get the formal process started.

Work out your aims

Are you buying a family home or a buy-to-let property? Do you want a forever home or somewhere that offers a good rental yield? Do you want to live in it for a few years and then sell at a profit? These considerations will help you to narrow down your search.

Find somewhere you like!

This is where a good estate agent comes in. You know roughly what you want so your agent can help you to find it in good time.

Pay your deposit

When you’ve found your ideal place and you’ve settled on a price, you pay a reservation deposit to take the property off the market. This reservation deposit also contributes towards the eventual purchase. You’ll fill out a form and engage a solicitor – the developer will probably be able to recommend someone.

Put your solicitor to work

The process of exchanging contracts usually takes around a month.

Get ready to exchange

You’ll need to put down a deposit – usually 10% of the purchase price minus your reservation deposit. Some developers will ask for stage payments before completion as well.

Watch the diggers

You can watch the building going up now, if you want! Your developer will send you regular updates and you can also request individual details like the positioning of plug sockets and the height of the kitchen counters.

Sort out the mortgage

Once you’ve exchanged contracts, you can ask your financial advisor about the mortgage application process. Lenders vary, but you can usually start it off around six months before you complete.

Make the place comfortable

If you’re looking to let the place out, your estate agent may have a lettings division that can furnish it and pre-let it so that it’s occupied from the get-go.

Prepare for completion

When the property is ready, you’ll get a completion notice advising you how long you have to complete the purchase; it’s usually two weeks. You need to tell your mortgage lender and your solicitor, who will do the rest for you. On completion day you can collect the keys!

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