The initial excitement of getting your Loan Offer can often be quickly diluted when apparent obstacles are put in your way by the mortgage process. Avoid the problems – follow our Guide.
When we as your solicitor get the Loan Offer, we can deal with the legal conditions but there are often items that must be dealt with by you and the Bank. Until those are dealt with, the Bank will not process further even if our legal requirements are fully dealt with.
Bear in mind the following:-
1.A Valuation Report is needed by the Bank –
- Identify the agreed Valuer (the Bank usually have a panel);
- Know the cost involved;
- Make the arrangement to inspect with the help of the Auctioneer.
2.Life Insurance cover is generally required.
- BUT, you don’t have to take any package that is offered by the Bank.
- You can often find a more competitive quotation in the general market or particularly from a professional brokerage firm.
- Do your research early so that you don’t run out of time.
- Making a phone call or filling out a proposal form is not enough – the policy must be in place and the interest of the Bank must be noted on it.
3. Household insurance, particularly fire cover.
- Do your research early to get a price that is acceptable to you.
- Compare to the price offered by the Bank.
- The name of the Bank must be noted on the fire policy
- Get the letter of cover required by the Bank.
4. Accurate address of the property – we regularly see a difference between the auctioneer’s description of the address, the one used in the loan offer (which is often the one given by you to the Bank) and the actual legal address when the title deeds reach us. That can cause untold delays because the Bank may take the view that it is a different property.
5. Accurate names of you the borrowers – You must use a consistent form of your name. You should decide on the format you want to use on your legal title and on your loan papers and you should stick to the one format at all times. Otherwise questions and delays will occur.
6. Lifetime of Loan Offer. Be aware that most loan offers now have a life time of only three months. If you have to gather the information we are describing here you can quickly run out of time which will force you to reapply, incurring further delay and expense.
7. A structural survey – we always recommend this. It is not a strict requirement of the Bank, but it is very wise that you protect yourself by having a proper survey done by a fully qualified and insured person.
8. Be certain that you have access to any further funds that are needed. The loan will only be part of the purchase price. The deposit and any balance together with the stamp duty, registration fees and legal costs must come from your resources. Have them available at an early stage.
9. If you are receiving money support to buy the house from a member of family, then we as your solicitors must know that early. Further documents are needed to be prepared and signed by the person making the gift. This can be another source of delay.
10. Finally, your expectations need to be managed and we can help you do that when you contact us early in the process. We can then try to minimise further unnecessary delay but of course we are all subject to the internal workings of the Banks and it is sometimes hard to understand the bureaucracy that they apply.