Frequently Asked Questions
Here is a list of the questions we’re frequently asked. If you have a question that isn’t answered here please get in touch and we will be happy to help.
Q: How much can I borrow?
A: See our step by step guide to buying which gives information on how to make the initial calculations. To get a definite answer however you will need to speak to the bank or a mortgage broker.
Q: Are bonuses included in the salary figure used to calculate how much you can afford?
A: A lot of the time yes. It will depend on the particular provider but if you receive a bonus every year it is likely to be included in the figure used for the calculation.
Q: Does my partner’s income count?
A: Yes it changes how the affordability calculation for a mortgage is calculated. See the step by step guide to buying section for more information on how to calculate this.
Q: I have other debts/loans will they matter?
A: A bank will assess your monthly outgoings against the money you get in each month therefore if you have debts/loans that have to be repaid each month this will be factored into the amount you can afford on a mortgage.
Q: How much is it all going to cost?
A: This varies greatly from case to case and will change dramatically if large renovations or the like are needed. As a guide however approximately £3,000 to £6,000 is generally needed for buying costs with stamp duty on top. Stamp duty is calculated as a percentage of the purchase price. These percentages are:
Up to £125,000 – 0%
£125,001 up to £250,000 – 2%
£250,001 up to £925,000 – 5%
£925,001 up to £1,500,000 – 10%
£1,500,001 up – 12%
You are only charged the percentage on part of the property price which falls into each band, so if you’re buying a house for £200,000 you won’t pay any stamp duty on the first £125,000. You will only pay the stamp duty on the £75,000 of the purchase price above that, which will be charged at 2% due to the band it falls within. In this example you would therefore pay £1,500 in stamp duty.
If the purchase price had been £300,000, the stamp duty charges would break down as follows:
0% on the first £125,000 = £0
2% on the £75,000 in the second band =£1,500
5% on the £50,000 in the third band =£2,500
Total stamp duty on £300,000 property = £4,000
Who to use
Q: Should I use a mortgage broker?
A: This is a personal decision but there are benefits to using a broker. If you’re time poor they cut out a lot of the leg work on your part, much like using a price comparison website for insurance, although some providers won’t be registered with them so check before you assume they’ve assessed the whole market for you.
Q: How do I find a solicitor?
A: The best way is to ask for recommendations from friends. If you don’t have anyone you can ask, get in touch and we’ll make some recommendations.