House is a building that serves as living quarters for one or a few families A home invited them to her house for dinner. a two-family house. A shelter or refuge (such as a nest or den) of a wild animal.
11 Steps to Take When Buying Property
If you have been thinking of purchasing a property, this is the right time for you to shop around and utilize the buyers’ market to your advantage. Do not be discouraged by the COVID-19 pandemic, banks have reported that they are processing successful mortgage applications.
Seeff Properties Botswana has drawn up these 11 steps to guide you in ensuring that your purchasing process goes as smoothly as possible, especially during the current buyers’ market.
VsVisit the Bank
Do not procrastinate with this as you will experience delays later in your process. The first step to finding the right property is knowing how much you can afford to pay for your new home. Your local bank will assist you with calculating an amount by looking at your pay slip so that you ascertain exactly how much you qualify for and at what payment rate. Should you have other existing loans, most major banks can consolidate your loans enabling you to improve your financial plan for the property market and become a homeowner.
- Have the Deposit Ready
It is advisable to have a deposit ready as it shows commitment towards the purchase of a home and ultimately reduces your monthly repayment installments. By reducing the amount, you need in a loan you are also reducing the amount of home loan interest you pay over time. Many first-time home buyers make the mistake of not finding out how much the bank will lend them. Most banks give loans looking at the market price of the valuation between 75% to 90%. Make sure to have the difference ready.
- Transfer Duty and Legal Fees
With the new transfer duty, you will need an extra 5% transfer duty for citizens. 30% of the sale price if you are a foreigner or Conveyancing attorneys have a standard fee structure as per the Law Society requirement; they will give you the amount to pay as your legal fees. At times buyers fail to proceed to purchase a home because they did not prepare for these costs. It is always advisable to do a bit of research on other charges involved. All the Seeff agents can advise you on these matters.
- Decide on Property Specs
Location, location, location. At this stage decide where you want to live or invest and what sort of property you are looking for. If it is a residential house decide on how many bedrooms and bathrooms, do you require a swimming pool, etc. Do some research on different locations within areas of preference. Visit the Seeff website and familiarize yourself with the property prices and the different types of homes available.
- Get KYC ready
The Financial Intelligence Agency (FIA) in Botswana requires all parties involved in property transactions to complete customer due diligence known as “Know Your Customer” forms( KYC). This is a standard practice that you will be requested to comply with either at the beginning of your property hunt, during, or even after. Both the estate and the conveyancer will independently require these from you.
- Contact your Agent
The Seeff website shows on average between 80 and 90 residential properties on the market for sale. There is a wide range of commercial, residential, and agricultural properties depending on your budget and requirements. Pick a few you would like to view depending on your preferred location and budget. Your agent will take you to view the selected properties. Your agent will also be able to advise you of any new listings as and when they become available.
- Make an Offer
One property should stand out from the rest, so put a written offer on it. Your agent will be with you every step of the way, guiding you to make the best offer that the seller might consider. You need to have thoroughly inspected the property as 99% of properties are sold “voetstoots” or as is. Read the offer letter carefully and if you need clarification on some of the clauses, approach your agent and ask relevant questions.
- Seller Accepts Your Offer
Now that your offer has been accepted by signing the offer letter, you will now need to get all your documents ready required by the bank if you haven’t done so already e.g. pay slip, bank statements, financial reports if a business, etc. Be sure to know exactly what the bank requires to make sure your loan application process is as smooth as possible.
- Hand in your Loan Application
submit your loan application. In some cases, you may need to be ready to prepare for a structural report as some banks require one, check with your financier. A valuation report is mandatory with all banks so get the money ready for a valuation and a structural report, if required. Remember, most banks finance 75% to 90% of the market value, this is where the deposit comes in handy.
- Loan Approved… Congratulations!
At this stage, you are on your way to acquiring a property. The bank will engage a conveyancer to register a bond against the property and transfer the title deed into your name. The seller has the first option to pick the conveyancer of their choice who can do both the bond and title transfer or just the transfer if they are not on the bank panel of conveyancers. They will proceed to ensure that the seller pays all costs attached to the property such as council rates and municipal bills. The conveyancer will get a tax clearance certificate from BURS so make sure you are in the good books with the tax man.
- Property Handover
After the title transfer, your agent together with the seller will hand over the property to you in the same condition you saw it at the beginning. Double-check that no fixtures have been ripped off, no loose cables, and air-conditioners and lights are still there unless stated on the offer letter that certain items are not part of the sale. Common questions buyers ask is “how long will the transaction take” the whole process can take up to 3 months or even more. Keep communication flowing between yourself, the bank, and your agent.
What is the step-by-step process of buying a house?
- Step 1: Check Your Credit Score.
- Step 2: Determine How Much You Can Afford.
- Step 3: Choose A Lender and Get Preapproved For A Mortgage.
- Step 4: Find A Real Estate Agent.
- Step 6: Make An Offer.
- Step 7: Get A Home Inspection And Home Appraisal.
- Step 10: Close On Your New Home.
What is the process of buying a house and how long does it take?
Timeline: 1 day to 2 weeks
It takes one day to two weeks for contracts to be exchanged and then for the sale to be complete. But it’s not unknown for people to exchange and complete on the same day. Completion day is when ownership is transferred from seller to buyer and you can move into your new home. And that’s it!
What are the 3 main steps to prepare for when buying a house?
These four steps can help you prepare to buy a house when you’re still getting ready for homeownership:
- Check your credit. Once you decide to buy a new home, the first thing you’ll need to do is check your credit history.
- Lower your DTI.
- Save for a down payment.
- Determine your budget.
What is the first thing to do before buying a house?
Before you start looking at homes, apply for mortgage preapproval with at least a few lenders. A pre-approval letter is a lender’s offer to loan you a certain amount under specific terms. Compare the offers to get the lowest rates and fees.