Mortgage

Here is a diary of my mortgage application and progress.

2012-02-12

I've shopped around and decide First Direct had the best mortgage for me. Important factors for me were the low repayment fees (none), low interest rates, and ability to offset the mortgage.

2012-02-13

I phoned up first direct. They take you through several steps.

It seemed a bit weird because they can only explain, but not recommend one of the mortgage choices, instead you have to know which one you are after.

I had wanted a 'interest only' mortgage but had to settle for a capital repayment. Our plan was to always have extra cash in the offset portion of the mortgage so I think this is nearly the same, but each month a portion will always be removed to pay down the capital.

2012-02-17 Friday

Got my mail from First Direct. I now have an 'agreement in principle'.

There are 2 forms. One is the "offset Mortgage" application form, and the other is for a "Mortgage valuation request". I haven't found a place yet, but I can send in the "offset Mortgage" application form first. This should start the process of validating your details and confirming the amount I can borrow.

Law Society can help you find a solicitor.

I found one but engagement will cost ?500.. so there is not much point in doing this until you find a property.

2012-02-20

I sent out an incomplete application to First Direct, so they could start the paperwork in case I find a place. I did not include the property (not yet decided) or solicitor, they said they could go and start the approval process without them.

2012-02-25

I got a reply saying I need to include 3 years worth of accounts. Since I do not use an accountant and funds move through my private limited company I sent them a lot of paperwork and explanation. I was thorough but this is really the 2nd time I've done this kind of application. I've done something simliar to prove earnings to the UK Border Agency for my visa.

2012-03-07

I phoned them up to check on the application and they said it is ok.. they might want some info about my spouse but will wait for a reply in paper before I send anything. I don't feel like looking at places in case I see something I want, but the mortgage doesn't let me borrow the amount I want.

2012-03-10

I got a letter from First Direct returning some of the paperwork I submitted. They didn't request any more information.. at least I know they are still looking.

2012-03-12

I got another letter that returned the rest of my documents. Also got a missed call on my mobile, so I phoned them back. The want to confirm my employment. Since I am self employed (via my limited company) they want to talk to the company I am contracted out to. I don't have many contacts for HR so I just gave them my manager for now.

2012-03-15

They had trouble contacting him, as expected, as he is not at his desk most of the time. Instead, I had to get him to phone First Direct when he is at his desk, then they gave him a call back on the landline. He just had to confirm my details.

2012-03-16

Now they are stuck waiting for property details. I'm still looking for a house.

2012-03-28

We had bid on one place for ?440K (asking was ?480K). and on another for ?450K (asking was ?500K). We finally agreed on ?447K for the first place.

I contacted a solicitor (Comptons at Camden) and received a bunch of forms via email. I will fill them out the drop them off at their office.

I also phoned up First Direct, my mortgage provider and they asked a bunch of questions such as:

  • brick vs. stone:
  • listed building:
  • how old is the building:
  • share of freehold. lease must be at least 50: (25 years on top of 25 mortgage term).

I think they wanted to start surveying with Countrywide Surveying Services. I have a reference number.

2012-03-30

I asked our solicitor about the forms, do I need to prove more than 10%, as I have agreed to pay more to First Direct for the initial deposit. yes.

Do I need to go to the bank and a stamped / certified statement from them? no, email is sufficient.

Should I instruct Country Wide surveyor to start ? no, wait for a contract from the vendor.

Open on Saturday? no. I will drop by on Monday with the forms

As for First Direct, I had filled out my form incorrectly and forgot to open a bank account with them. I need this to offset the mortgage. I phoned them up and a got a BSB, account number as well as the IBAN number. I should be able to login and view the bank account on Tuesday.

2012-04-02

Went into the solicitor's office with my proof of Address etc. They did a photocopy there. We paid ?500 to start the process. I could have waited until they received the contract but this will allow them to start as soon as they receive it. If the contract doesn't appear then the payment can go towards our next purchase.

2012-04-05 Thursday

Got an email from my solicitor, they now have copies of the title and plan for the property. We are still waiting for the "balance of contract" papers.

I also got a revised mortgage offer based on the purchase price of ?447K.

2012-04-08 Sunday, Easter

I've emailed my solicitor back saying to wait for the contract before doing an searches (these incur fees).

I've also sent out the signed Mortgage Offer back to First Direct. I hope we can still get our 2.08% above the base rate (I'm looking at the latest public offer online and the arrangement fee has changed to ?999 from ?1499, but the rate has changed to 2.29% above the base rate. At the moment the base rate is 0.5%.

2012-04-09 Easter Monday

I returned a missed call from Saturday from First Direct. I have given them my solicitor's details

2012-04-11

The contract has arrived at the solicitor's, so I've given the go ahead for searches and will start my survey.

I asked my solicitor where to put the deposit, and found that the deposit money should be transferred to the solicitor. Since my daily transfer limit is not that high, it makes sense to pool the deposit money into 1 account, before transferring the lot to the solicitor. I will probably have visit the bank branch in person to transfer such as large amount of money.

I phoned up Countrywide Surveyors so they can proceed with the survey. I opted for a First Direct Homebuyer's Report (which costs more than a Standard Report). They do not accept American Express, so I paid with my Mastercard. This valuation fee is based on the home price, it costs me ?593.

2012-04-13, Friday

I received a letter from United Surveyors, stating they will undertake the survey. I suppose Countrywide contracts out the surveying to different companies. The pamphlet I received was from the Royal Institution of Chartered Surveyors... seems legit ;)

The survey report should tell us about the repairs needed, and also a valuation of the property.

I am not sure when the survey is scheduled.

2012-04-16

I received a letter from Countrywide Surveying Services confirming that the took payment.

2012-04-20, Friday

I received the HomeBuyer Report (survey) in the mail. It was done by Addison Lovett & Lord. They found some cracks (none recent) and recommend and insurance policy that includes "subsidence, land slip and heave" clause. They also mentioned some red bricks that may need replacing, and the entrance door should be replaced with a fire door that confirms to current fire legislation. There is overflow discharge from the boiler, so we probably should get that repaired or replaced.

There is a current reinstatement cost estimation, which is a rebuild cost.

With all these problems I will probably try and renegotiate the purchase price.

I've given my solicitor a copy of this report. The report is quite long so we visited his office and let him make a copy. I also gave him a copy of the mortgage offer, I think he's still waiting on documentation from First Direct.

My solicitor is still waiting on some searches to complete, these should be done next week

First Direct also sent me a SMS saying that they now have enough documentation and are waiting for a completion date from my solicitor.

My vendor (who we are buying from) is also purchasing a place at the same time, so we are part of a chain. They had the survey done at the same time as us, but I am unsure of their results.

2012-04-30

I received an email with the fittings and contents that will be left for us. We want to get rid of the cupboards but they are fitted. We can carefully remove them after we move in.

2012-05-05, Saturday

I received a huge report from the solicitor. It is the report on contract and title. It contains a summary of the results of the searches, and some points that are still outstanding that will be sorted out with the vendor.

Inside there are council search reports, drainage search, insurance status, land registry reports and the lease.

The lease contains rules about living in the flat.

There is also a FENSA document saying the windows are compliant.

2012-05-08, Tuesday

I transferred the deposit to the solicitor. The deposit is 10% of the purchase price. This is not the same as the mortgage deposit (which is much higher).

2012-05-09, Wednesday

They want to exchange contracts by Friday, which should be ok. We are waiting on an asbestos and fire risk assessment for the common parts of the building. This should be ready tomorrow. We plan to visit the solicitor tomorrow and sign the documents.

There is a minor issue where the lease refers to both Ground Floor and First Floor. We could resolve this post-completion.

2012-05-10, Thursday

We visited the solicitor and signed the contracts for Standard Conditions of Sale, Certificate of Execution and Legal Mortgage.

We also dropped by the estate agent and told them the good news.

2012-05-14, Monday

So it wasn't signed on Friday. There was an issue with the insurance for the building. It described the house as a 6 bedroom terraced house instead of flats. We will wait until this is sorted out.

The asbestos check for the common areas has passed.

2012-05-15, Tuesday

Our solicitor phoned and has finally had the contracts exchanged. He attached a Lang Registry Transfer of whole of registered title(s) which we have printed out. We'll need to have this signed by witnesses.

Moving in date should be the 1st of June

2012-05-17, Thursday

Our estate agent has sent us a letter confirming successful completion. We can collect keys from them but must remember to get confirmation from the vendor's solicitor before they can give us the keys.

2012-05-18, Friday

We had our friends (Adrian and Oni) witness the transfer form

2012-05-19, Saturday

We've dropped the letter at the solicitor's office. They do not work on weekends.

2012-05-21, Tuesday

First Direct SMS'd saying my mortgage is about to open. I will need to add my account to the offset mortgage.

2012-06-01, Friday

Picked up the keys and moved in :)