Your deposit is not the only cost to think about when you’re considering a mortgage. You’ll also need to budget for stamp duty – a tax due on any first-time buyer’s property worth more than £300,000 in England and Northern Ireland – along with mortgage lender fees, property valuation costs and legal expenses. In Scotland, instead of stamp duty you’ll pay the Land and Buildings Transaction Tax (LBTT), while in Wales it’s the Land Transaction Tax (LTT).
Our data shows the costs related to mortgage lender fees alone could be £1,200** on average. Mortgage lender fees tends to cover a booking fee, administration fee and valuation fee. Stamp duty is another cost to consider – and this would cost a home mover £2,500 on a property worth £250,000. The government’s website lets you calculate how much stamp duty you’d have to pay depending on your circumstances.
Legal costs, which will also need to be factored into your budget, could range from £500 to £1,500 or more. Our guide to conveyancing outlines the legal expenses relating to a property’s sale.
**This price is from Compare the Market data and is correct as of 4 March 2019. This figure is based on a home mover – in other words, not a first-time buyer – looking to take out a 25 year repayment mortgage on a £250,000 property with a £50,000 deposit. Prices will vary according to a range of factors, including your property’s value.