How much does it cost to buy a house? Honestly, anyone who’s done their research will know it’s not just the mortgage and the deposit. There are, of course, other fees involved; everyone knows that.
But what can often be overlooked is how much these extra costs can run up and exactly what you’re likely to be paying for, especially if you end up making offers on multiple properties and have to pay these costs more than once.
There are loads of hidden extras that, especially for first-time buyers, are easy to overlook – you can’t budget for them if you don’t know they exist, right?
So let’s take a look at some of the costs that you might find you need to pay out for on your search for your next home.
Mortgage Arrangement Fee
The mortgage arrangement fee is what some charge to set up a mortgage. It can be added to the cost of the mortgage or paid upfront, and for the most part, you can expect to pay around £1,000 for this fee. It’s quite a significant amount to pay out, but if you add it to your mortgage, you’ll pay interest on it too, which is more expensive. This does not apply in all cases, but it’s worth being aware of, just in case.
Mortgage Booking Fee
The cost of this mortgage is going up and up now, isn’t it? A mortgage booking fee is exactly how it sounds. It’s a fee some lenders add when you pay for a mortgage. And it’s non-refundable, so if you get declined or don’t take the mortgage offer, you won’t get it back. You can expect this fee to come in around £100- £250 for the most part, and in some cases, this too can be included in your mortgage (or even the arrangement fee if one applies).
CHAPS Fee
A CHAPS fee is a telegraphic transfer fee. It’s what the lender charges you for sending the mortgage money to your solicitor. This fee is payable on the day of completion and is around £25-£50 on average, although it can vary. It’s also non-refundable, but as it’s payable on the completion day, chances are you won’t be backing out anyway.
Stamp Duty
Stamp duty has to be paid within 14 days of the completion of the property transfer. In most cases, our conveyancer or solicitor will handle the payment on completion day, and you’ll pay them. They’ll work out exactly how much you owe based on the sale price.
Before you buy, your estate agent will inform you if your chosen property is going to require stamp duty to be paid — currently, all properties over £125,000 (those between £125,001 and £250,000 pay 2% stamp duty).
Legal, Land Registry and Survey Fees
Its starting to feel a bit like your fees have fees and you’re not wrong if you think that but one area that can be costly is the fees for your land registry searches (anywhere from £250-£300), your legal fees which can run from £850 upwards and your survey fees, again the ballpark is usually around £150 to £1,500 depending on the company you use, property type and the survey you choose to carry out.
These fees add up quickly, and if you’re looking to buy your next home, these are fees that need to be paid outside of your deposit and mortgage for the most part and upfront. So budget accordingly!
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