How to reserve your new home
A guide to property reservations
You’ve done your research, you’ve been on multiple viewings and now you’re confident that you’ve found your space – it’s time to reserve your new home!
When you reserve a home, you agree with the seller, developer or landlord to hold the property for you while finalising the details. This usually involves paying a fee and is common across the private sale and affordable housing market.
The buying process can be daunting, especially for first time buyers, which is why we’ve put together a step-by-step guide to reserving a new home.
Calculate your budget
It’s key that you work out what you can comfortably afford – you can use Share to Buy’s online affordability tools to help you work out your finances. We also suggest speaking to a specialist mortgage broker or independent financial advisor who will be able to help find the best mortgage deal for you.
If you’re buying through the Shared Ownership scheme, you usually apply for your mortgage after you’ve chosen the property. If you’re buying a home on the open market, it’s a good idea to get a mortgage in principle before you start your viewings as this will put you in a strong position to make an offer on the home you want.
Reserve your home
Once you’ve confirmed your financial eligibility, it’s time to reserve your home. You’ll pay a reservation fee, which can vary from £200 to £1,000 (this will depend on the provider and the tenure you’re buying through) and the property will be taken off the market.
During this time, a reservation agreement may be written up which acts as a contract between the buyer and the seller (which is usually the current owner, sales agent or a housing association) that agrees on the price and terms under which the property will be sold.
Your reservation period will last for whatever amount of time has been agreed between you and the seller, and this is essentially the time limit for the buyer and seller to exchange contracts.
Appoint a solicitor or conveyancer
At this stage, you’ll need to appoint a solicitor or conveyancer who will handle all of the legal aspects of the buying journey for you.
Your conveyancer will be a huge part of the process so we’d recommend doing your research, reading reviews and getting multiple quotes before appointing your legal firm. To help get you started, you might want to take a look at our panel of solicitors and conveyancers.
Finalise your mortgage offer
If you are buying through Shared Ownership, you will undergo a financial interview from a housing provider, who will then issue your solicitor with a ‘Memorandum of Sale’ – this summarises the details of your proposed purchase. Not all mortgage lenders will require this, but likely will if you’re buying via Shared Ownership. If you don’t already have a finalised mortgage offer at this stage, now is the time!
You can find out more about the financial process on our mortgage hub, with access to free guides, comparison tools and affordability calculators.
Exchange contracts and complete
When you exchange contracts on your new home, you are legally bound to purchase it. At this stage, you will find out your completion date, which is when you will pay the deposit and any final funds on your property through your solicitor. On this date, you officially become the owner of your new home.
Once the keys to your new property are handed over, it’s time to move in and make your new space your home.
