Financial Considerations When Buying a House in the UK

Written by Henry Findlater

When it comes to planning for a home purchase in the UK, the traditional factors and aspects of your financial life to consider include:

How much can I (and should I) put down?

When considering how much to put down on a home purchase, you need to think about what you have in the way of existing liquid assets versus what you will pay off over time. The more you put down up front the more equity you are putting into the property as you move forward. Frequently, the larger the deposit, the greater the choice of mortgage deals. The exact amount of deposit will depend on individual facts and circumstances.

Have I taken into account any SDLT and Conveyancing Fees that will be payable?

It is easy to forget about how much SDLT and Conveyancing Fees amount to when you are purchasing a property. When looking at how much you have available to allocate towards a deposit you also need to consider the cash outlay for these.

What kind of mortgage do I want to secure? 

Knowing whether it is beneficial to secure an interest only loan or a principal repayment mortgage as well as looking at the appropriate repayment period and repayment vehicle are all important things to understand and give consideration to. Additionally, you want to think about whether you want a fixed rate or variable rate and what, if any, associated insurance protections are appropriate. The decisions made here will first and foremost impact monthly cash flow. Thinking through how the property will be used now and in the future and knowing how long you may own the property are factors to take into account.

The Legal Stuff

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