When you exchange contracts with a seller, you are committing to making that purchase no matter what. Even in an absolute worst-case scenario, say the house is struck by lightning and burns down, you are still committed to buying it. This means that, as a buyer, you need to be prepared.
Do your homework thoroughly before you exchange
First of all, make sure that you’re really comfortable, if not actively happy, with the local area. Think about the practicalities across all seasons, including the depths of winter. Think about what it might mean for working at your current place of business and from home. Think about what it might mean if you wanted or needed to change jobs.
Secondly, make sure that you’re really comfortable with the property itself. Unless you’re knowingly buying a “fixer-upper”, then you need to be sure that the property is structurally sound. Unless you’re buying a new-build with a reliable builder’s guarantee, it’s usually very advisable to have a property surveyed rather than just valued.
In simple terms, a survey looks at the structural soundness of the property and tries to confirm whether or not any issues can be reasonably foreseen. A valuation essentially just looks at how much the property could be expected to fetch if it had to be sold. It, therefore, acts as a baseline for calculating the loan-to-vehicle ratio of a mortgage.
Make sure you have insurance from the point of exchange
It is impossible to overstate the importance of this point. It may be highly unlikely that anything will happen to the property between exchange and completion. There is, however, a huge difference between unlikely and impossible and that difference can be painfully expensive. If that difference happens to you, then you will be the one taking the financial hit – unless you have insurance in place.
The case for insurance becomes even more compelling when you consider how little it can cost. Firstly, you’re only insuring the building itself. If the seller still has property in it, then that is their problem. Secondly, you’re only insuring for the rebuild value rather than the purchase value. Essentially, you already own the land on which the property rests, so you’re only looking at the cost of rebuilding the property itself.
Think about whether or not you need insurance for your move
If you’re using professional movers then check that they have insurance in place. If you’re planning on moving yourself, even if only in part, then you may want to check if your existing home insurance covers you for the move. If it doesn’t, you may want to see if you can take out insurance to cover you during the move itself.
If you are hiring a van, then check what insurance is covered as part of the hiring process. If it’s insufficient, then again see if you can find extra cover for the process of the move. If you’re borrowing a van or car then it’s vital that you have standard third-party insurance in place as well as insurance for the goods you are moving. Never assume that either the vehicle owner’s insurance or your insurance will cover you for either event.
Update your insurers on your move
Remember to let your insurers know that you have moved. In fact, remember to inform all the companies with which you do business. If you receive any benefits, you will probably have to update the relevant authority. You may also want to think about applying a mail redirect to catch anything you’ve forgotten (or if a business doesn’t update its records properly).
This can be a tedious exercise at a busy time, but it’s also an opportunity to close off old accounts and hence reduce the number of organizations which have your data.
Your property may be repossessed if you do not keep up repayments on your mortgage.