Buying a Home
We cannot offer financial advice in relation to house purchase, but there are certain basic steps that you’ll need to take. The first is deciding what deposit and monthly repayments you can afford, which will influence the size, type and location of house that you can realistically expect to buy. If you are borrowing money for the purchase from a bank or building society, you will need to agree terms with them. You ought to do this, and obtain a loan offer in principle, before you start making offers to buy a property, so that - if your offer is accepted - you know that you’re in a position to complete the deal.
It’s very unlikely that you will be able to borrow 100% of the purchase price, as banks are nowadays much more cautious in the wake of the banking crisis. The lender will most likely lend a proportion of an independent valuation of the property. For example, the house may be valued by a bank’s surveyor at £180,000 and the bank may then offer a loan of 90% of that amount, £162,000. Even if you offer more than £180,000, the lender won’t increase the loan. In this example, you’ll need a deposit of £18,000. Your monthly repayments will be related both to the size of the loan and the prevailing interest rate. Over recent years, interest rates have been particularly low, and you should bear in mind that, over the period of a mortgage – perhaps 20 to 30 years – those rates could rise substantially.
If you’ve come to this page because you’re thinking of moving to Shetland, we’d recommend a visit to the section on housing on the Move.Shetland website, and indeed to other parts of that website. It provides more information about the Shetland property market and about the Scottish system of house purchase.
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