Initial Costs of House Buying

Buying a house or flat is quite an expensive business. Quite apart from having to find the deposit money in cash, say 10% of the price, and of having to make the regular recurring mortgage payments of interest and repayment (or endowment premium) there are quite substantial initial costs to budget for.

Structural survey

In the case of a new flat or house, or one that is less then 10 years old and on which the builder's 10-year guarantee is still in force, a purchaser may be prepared to accept that the property is free from major faults. For older properties, however, it would be a reasonable precaution to commission an independent, qualified surveyor to make a structural survey to ensure that there are no hidden, serious defects. The fee for this is likely to be between £100 and £200, but there is no set scale.

Building society valuation

A house buyer applying for a building society mortgage loan will have to pay the valuation fee of the surveyor employed by the society. This is additional to the cost of any survey commissioned by the buyer. It should be realised that the inspection by the society's surveyor is not a structural survey, but only a valuation for the purpose of confirming that the property is suitable security for the loan. The present scale for valuations is as follows:

Valuation Fee

Not exceeding £15,000 £5 plus £1 per £500 or part there- of in excess of £2,000

£15,000 to £300,000 £301 plus £1 per £1,000 in excess of £15,000

£300,000 to £40,000 £46 plus £1 per £2,000 in excess of £300,000

Over £40,000 by arrangement

The Home Loan Scheme

There exists a government-sponsored scheme for assisting first-time home buyers. The scheme offers a tax-free bonus and an interest-free loan to those people who have been saving for at least two years under the scheme. In addition to the bonus, of course, normal interest will be paid on the investment by the savings institution.

To take advantage of this scheme a person must agree to save regularly (no minimum amounts are laid down) with any of the many acceptable institutions, including banks, friendly societies, building societies, National Girobank, National Savings Bank and Trustee Savings... see: The Home Loan Scheme

Personal And Business Finance 2018

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