EXTRA SECURITY
Most lenders are happy to consider lending up to 75% of the purchase price/valuation of your home. If you want to borrow more than this, the lender may need extra security in the form of an insurance policy which the lender will arrange for their own benefit.

You may have to pay the one-off premium for this Higher Lending Charge. If you do, most lenders will allow you to add it to the mortgage amount.

The insurance policy covers any loss the lender may incur, if they had to repossess then sell your home, if they do not recover the full amount of the mortgage. If this happens, you will be legally responsible for any shortfall on the mortgage. Even if the lender has insurance in place, the insurer generally has the right to recover the shortfall from you.

SURVEYS
Valuation Report
You will normally have to pay the lender a fee for a surveyor to value your new home.

This is done for the lender's benefit, to confirm the property is adequate security for the loan. It should tell you if there is something seriously wrong with the property, but it does not involve a detailed inspection.

The percentage of the value you can borrow will be based on the figure in the report, and not necessarily on the price agreed with the seller.

Other Surveys
For your own peace of mind, it is a good idea to arrange your own survey.

If you are buying an older property or planning to live in an area that has suffered from subsidence in the past, McAfee Properties & Mortgages strongly recommend you get a survey done.

You may be able to save money by using the same surveyor who carries out the lender's valuation.

A 'homebuyer's report' is usually more thorough than the lender's report and tells you whether the property is structurally sound - but it gives no guarantees. A 'full structural survey' costs more but gives the added guarantee of legal protection against incorrect information.

TAX
Stamp duty
Stamp duty is a tax on buying property and applies to all properties worth over £125,000 as the chart below shows. Your solicitor will collect the stamp duty.

Since November 2001, the stamp duty threshold has been increased to £150,000 for certain property transactions in disadvantaged areas to help improve and rebuild those areas. Your solicitor or the Inland Revenue can let you know where these areas are.

Purchase Price		Stamp Duty Payable
Up to £125,000:		nil
Over £125,000 (on whole amount):		1% of the purchase price
Over £250,000 (on whole amount):		3% of the purchase price
Over £500,000 (on whole amount):		4% of the purchase price

These limits may change

SOLICITORS
As well as paying a solicitor or licensed conveyancer for the work that they do, you will have to pay the cost of land registry charges and local search fees.

The whole process mean that once the sale goes through, the property really belongs to you and you are fully aware of any factors affecting the property.

APPLICATION FEES Some mortgage lenders now charge an application fee to cover their initial administration costs. Fees are especially common with limited offers like fixed rate deals and may not be refunded if your purchase falls through. Some lenders offer mortgage deals with cashback which cover some or all of these fees. Your adviser at McAfee Properties & Mortgages can prepare a full written quotation which shows how much you will have to pay each month and what the up front charges are. It may also be helpful to look at the annual percentage rate (APR) on your mortgage quotation. This should account for the true cost of the mortgage, including everything you have to pay to get the loan, like an application fee or higher lending charge. But remember that the APR spreads the up front charges over the whole period of the loan, even though, on average people move home every seven years. So, the charges can make more difference than the APR might make you think.

We do not charge a fee for arranging a mortgage as we receive payment from the lender. However, a purely fee based option is available of 1.5% of the mortgage amount. Your home may be repossessed if you do not keep up repayments on your mortgage.