Regardless of whether you’re buying or selling, there’s no time to lose if you want to make the most of the Stamp Duty holiday. If you’re doing both, then there’s definitely no time to lose. Being organised is always a plus in the property market. Right now it’s vital. Here are some tips to help.
Sellers should get their paperwork organised
This is a good move at the best of times. This year, it could literally make the difference between making a sale and seeing a buyer move on to another property. The SDLT holiday is due to close at the end of March 2021. That is not long to see a property transaction through from marketing to completion at any time, let alone during COVID19 and the festive season.
There is always a possibility that the Stamp Duty holiday will be extended. This is, however, very unlikely. Quite bluntly, the government is likely to want to get the tax revenue flowing again as quickly as possible. Astute buyers will be well aware of this and will therefore be looking to work with motivated and organised sellers.
Buyers could start looking while being approved for a mortgage
These days, the standard advice to buyers is to get preapproved for a mortgage before they put in an offer on a house. In principle, this advice still holds. In practice, when a clock is ticking, you need to get moving. This means that, for once, it probably wouldn’t hurt to get busy house-hunting at the sale time as you are sorting out your mortgage pre-approval.
In fact, this could be essential to beating the Stamp-Duty-holiday deadline. Keep in mind that the Chancellor’s move has created a huge demand for property. This means a huge demand for mortgages. Processing mortgage applications is skilled work, so the lenders cannot just ramp up their staff. If anything, the process will be slowed down because of COVID19.
Buyers need to be realistic about their mortgage prospects
It’s generally advisable to be realistic about your mortgage options. If you’re planning on house-hunting before you’ve been officially approved for a mortgage. Apart from anything else, currently, sellers can expect to have competing offers. Given that many sellers are also buyers themselves, they’ll probably be keen to choose a buyer who can complete quickly.
There are three key factors which will determine how much of a mortgage you are likely to be offered. These are your credit score, your deposit and your income. At this stage, there isn’t likely to be much you can do to improve your credit score. You should, however, still check it, partly so you know what it is, and partly to make sure that it is free of errors.
Make sure you understand each lender’s policy on deposits. Specifically, you will need to know the minimum deposit they will accept and if they have any rules on gifting. Also, be clear about the fact that your headline income is only an indication of your ability to service a mortgage. Lenders need to look at the issue of affordability in a much greater level of detail.
It’s advisable to choose a conveyancer before you find a house
Conveyancers are also experiencing a surge in demand due to the Stamp Duty Holiday. As with mortgage-application processing, this is highly-skilled work. It cannot just be passed off to temps. An efficient conveyancer can make a buyer’s life much easier so it’s important to choose one wisely and to be prepared to pay for quality service.
Having your conveyancer lined up in advance means that you can move as soon as you find the right property. This could make the difference between making the Stamp-Duty-holiday deadline and losing out on it.
Your property may be repossessed if you do not keep up repayments on your mortgage.