If you have finally found a property that you intend to buy and turn into your first real home, you may be filled with excitement and trepidation. You are keen to move forward and secure the house so that you can get on with your life, but you want to make sure that you do this properly and do not run into any problems with the paperwork. While you will always want to get professional support here, you need to be particularly careful when it comes to the actual finances. What do you need to bear in mind?
Step-By-Step
Most people, and especially if they are on the first rung of the property ladder, will need to borrow a certain amount of cash in order to compete. There is, of course, a ready market, and you'll find banks and other institutions that may be ready to help. However, you do need to go through a certain procedure and ensure that you do not sign any paperwork with the seller unless you are sure of your ground.
Prequalification
Many people may have an exploratory conversation with a lender and based on that chat may be told that they 'prequalify.' Nevertheless, this has a specific meaning, and it does not mean that you will definitely get the money further down the road. The news is valuable in its own right, as it allows you to look at properties of a certain value. After all, you should be able to buy a certain type of property in between the money that you have and the money that the institution believes you qualify for.
Conditional Clause
If you are certain that you have found your dream property and you want to secure it before someone else comes along, always ensure that the contract has a specific conditional clause. Never sign any documentation unless it is predicated on you obtaining a loan approval for the specific amount of financing. This clause puts the onus on you to take the appropriate steps to get the approval, but it does not tie you to the contract otherwise.
Bank Approval
Remember, the bank will need to value the property, make sure that the title is clear and look at your personal circumstances more closely before they actually approve.
Advice Needed
If you work with a qualified and experienced conveyancer, they will walk you through this process from start to finish. As this is your first time, don't go alone.
For more information about conveyancing, contact a firm like Maley's Barristers & Solicitors.
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