First-Time Buyers Fees – What Do You Need to Save?

Posted on February 28, 2017

Whilst the huge deposit that you need to save in order to buy your first home is highly publicised, taking that initial step onto the property ladder is a lot more expensive than many buyers anticipate. There are a variety of other costs that go hand-in-hand with your property purchase, and fees can in fact run into their thousands. As a leading estate agent in Sunderland, we have helped countless buyers find their dream homes. Whether you are purchasing your first or your next property, being clear on all the costs before you buy means no nasty surprises or last minute hunts for cash.


The property market may be stronger than ever since the recession but hefty deposits are still required. Mortgage lenders demand at least 5% of the value of the property that you are looking to buy as a down payment, and as a rule of thumb the higher the deposit, the better the mortgage deal. Taking time to save as much money as you can towards your deposit will pay dividends when it comes to keeping up with monthly mortgage repayments.

Mortgage fees

In addition to putting down a deposit, your mortgage provider may also charge set-up or booking fees depending on the product you choose. Fees range from £99 to £250, and most are fully refundable if you have to pull out of a sale before completion. With selected mortgage products you may also be liable to pay an arrangement fee, a cost which is either paid upfront or added to your total mortgage amount. This fee can cost up to £2,000. If you have found your chosen mortgage product with the help of a broker, other fees for this service may also apply. Brokers charge fees of up to £500 or simply charge commission on the value of your mortgage.

Mortgage fees continue with valuation and survey, account and higher lending charges, and depending on your chosen product, these costs can easily add up. Mortgage providers can charge up to £1,500 for valuation and survey, whilst a fee of up to £300 is typical when handling the administration and maintenance of a mortgage account. Higher lending charges tend to equate to 1.5% of the amount you are borrowing, this provides insurance cover for the lender should you be borrowing money to cover the majority of the property value.

Stamp duty and searches

Before completion, you may have to complete searches with your local council to ensure that the property you are looking to buy does not have any associated planning, drainage or local issues. Your solicitor or conveyancer will request the necessary searches on your behalf at a cost of between £250 to £300. Stamp duty is another unavoidable cost and whilst homes purchased for less than £125,000 have no duty to pay, homes purchased above this value pay a percentage depending on how much over the threshold their purchase is. The latest Stamp Duty Land Tax rates for residential properties can be viewed here.

Other fees

Additional costs to consider when purchasing your first home include survey fees (applicable if you opt for the home condition survey, homebuyer’s report or structural survey), registration of title (Scotland only), moving costs, CHAPS or telegraphic transfer fee, and building insurance fee.

Need further advice on buying your first property and the associated costs? Contact our friendly and professional estate agents today for help and advice.