As you may or may not know, we moved house about a month ago. While this does not exactly make me an expert in the property business, it turned out to be quite a long and drawn out process (which seems rather typical) and along the way I picked up some pretty good tips. Some were from the fair readers and commenters of this very blog, some were things that we did that worked out well for us, and some are things that we would have done differently had we been given the chance to do it again (erm, no thanks!) or the discovery of a time machine in our new cupboard under the stairs (well now that would be rather cool wouldn’t it!?).
As they say “sharing is caring” so it would be a bit mean not to pass such wisdom along to the next set of home buyers out there that might need it, so brace yourself… here come da tips:
1. Use money back mortgages*
Thanks to regular commenter Living Cheap In London who put me onto this with this comment. Basically they are mortgage broker who pays you to use their services. Well that’s certainly novel isn’t it? To be clear, they obviously get paid a commission from the mortgage providers as well, but they pay you a percentage of that, whereas most brokers take the commission and charge you for their services, the cheeky blinders! Service was excellent throughout and despite a few hiccups along the way, our advisor really worked hard to get us the best deal approved. We got the £187.50 cash back paid into our account last week, roughly one month after completion. How awesome is that?!
They also do remortgages so use them even if you aren’t moving and just want to switch to the best deal!
*I have no affiliation with MBM and therefore am purely recommending them on having a good experience with dealing with them and the fact that I think they have a great business model!
2. Beware of online comparison websites
If you go with MBM from #1 then you don’t really have to worry about this, but if not then be aware of the big comparison sites out there. Apparently some have been found out promoting offers that earn them more commission and hiding ones that don’t (I’m not sure if this includes the mortgage section but just something to be aware of!). If you don’t want to go with MoneyBackMortgages I would actually suggest paying for a mortgage advisor over and above just doing research using online comparison websites and picking one out yourself, because even if the paid for advisor saves you a fraction of a percent by finding a product that the comparison sites “forgot” to show you, it will more than likely cover the cost. Just make sure you go to a broker who covers the full market.
3. Use a cheap online conveyancing service
DYOR as usual but we had a good experience with Gordon brown law firm (again, no affiliation with this company). Sure, they took a while to get back with some of the queries, but last time we moved we paid twice the price for a local solicitor, thinking it would be worth the money, who would take even longer to get back to us, ignore our calls, and generally was never in the office anyway (“Oh sorry she’s on a long weekend skiing break until Tuesday”. “Oh sorry, she doesn’t work Wednesdays or Thursday”. Yea, totally worth the money for that!).
GBLF are a bigger company so if you solicitor is out of the office at least you have a chance of someone covering for them and things can keep moving. There are plenty of others out there, I repeat DYOR, if you find a good quote, then make sure you google the company first. I found some good information on ones to avoid on the MoneySavingExpert.com forum! The total solicitor costs for buying and selling came to about £700 (not including extraneous stuff like searches etc…) which I thought was pretty darn cheap.
4. Kill any balances on credit cards
In the months running up to applying for a mortgage, I would advise that you don’t indulge in any credit card hacking. Even rolling balances seem to look bad to the mortgage companies (for some reason) and this got me in a spot of bother in terms of delaying our application.
I’ll try to keep the story short: basically I decided to pay off the solicitor fees (everything, including stamp duty etc) to cream off an extra few pounds from my old Barclaycard cash back card. Pro Credit card hackers call this sort of thing “manufactured spending” and it’s quite rife in the good ole US of A (see MMM and FIFighter for some examples) whereas the opportunities over here tend to be few and far between. I checked with the solicitors and they said I could pay with VISA, for an extra 3% fee. However, my yearly reward month was coming up in which I got 4% cash back* on my top 5 purchases, so considering the fee’s were about £5,000, I decided it was a good idea to net the 1% difference for about a £50 “profit”. Not bad for a few emails and an online transactions worth of work… Or so I thought! Turns out the mortgage company thought I was some sort of crazy spendthrift ass-hat, and it took aaaaages (like way more than a month) to actually come through onto your credit report that I was paying off the balance in full each month, so all the while they were waiting for that to show up, we could not proceed any further with the application. It totally wasn’t worth the £50, so as I say, I would in fact just stop spending any money on your cash back cards for a couple of months and forgo the likely £10-£20 you would have earnt, so the mortgage company can see you have zero (hopefully!) debt, other than maybe your existing mortgage if you are moving.
*Unfortunately Barclaycard have stopped this system and it’s a straight up 0.5% cash back year round, which while better than nothing, really sucks compared to the old system! So there really is little to gain from this kind of manufactured spend nowadays
5. Delay any big purchases
In a similar vein to point four, try to delay any big purchases that may look bad before applying for a mortgage. Now the government is cracking down on the affordability aspect (since April 2014), you need to keep silly stuff off your balance sheet. They also look at your monthly commitments (gas bills, gym, car credit repayments!). As a frugal dynamo this should be fine for you, as I am sure you have killed most of your unnecessary monthly payments, but it is something to be aware of.
6. Be patient
Not really a tip as such but more on psychological aspect. How? Look to the stoics. Don’t get caught up in all the little details. Realise that all the set backs will be totally forgotten about within 6 months when you have finally moved. Any problems that may come up have happened thousands, perhaps millions of times, to other people when they have moved house, and have been overcome (eg. Problem on the survey, etc) or that if the problem really is too large then it just wasn’t meant to be, but you’ll find likely end up finding something better! Remember that any delays generally means that you can save more money (assuming you aren’t downsizing) so every cloud has a silver lining, and all that.
7. It ain’t over till the fat lady sings
As I found out with a bit of a slap in the face from Mr Real-ity Estate, just because you have had offers accepted on both sides, and even a chain complete, doesn’t mean that you are anywhere near moving yet (see article and subsequent comments from myself here!). Again be patient, hope for the best but be prepared that it might fall through before you get to completion. If you have your heart set on your dream house, there is surely something similar (or better!) waiting for you if you look hard enough.
Any more tips for moving house I have missed out on here?! Input from the intelligent and good looking commenter crowd are as usual more than welcome!