Borrowing Money

When you are moving house you will often be seeking a loan of money to be able to buy your new house, even if you are raising part of the purchase price from selling your existing house.

Since these mortgages often involve hundreds of thousands of pounds, the lenders are going to want to be very sure they are making a good investment. The lender will want to ensure that you are likely to be able to repay it. They will also want to be sure that it will be able to reduce their loss even if you can’t.

So most loans for the purchase of land are mortgage loans The borrower will obtain an agreement from a lender, before actually making a formal application . The actual application is very involved for both parties and you need to be able to show you have means to raise the money. The final agreement in principle does not bind you or the lender, but does show you have taken steps towards raising money.

An Example

Let's assume you are buying a house for £250,000, and selling for £200,000. Here is an outline of what your costs will be

Lawyer's fees £1000-£3000
Removal expenses £300-£1000
Land Registry and search fees £150
Survey/valuation £300-£800
Mortgage lender's expenses £200
Stamp duty £9000

So the overall cost may be approximately £2000, most of which goes to the government.

Sheffield mortgage

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