General Costs & Fees

1. Deposit

This is by far the biggest cost in buying a home. Many sellers and mortgage lenders require that you pay at least 10% of the purchase price up front. You'll also get a better interest rate the more money you put down. Note too that if you fail to stump up 10%, mortgage lenders typically impose/require that you obtain expensive mortgage indemnity insurance (see below). If you're worried about funding a deposit, remember that if you're selling a property as well as buying one, your solicitor can apply the money received on the property you're selling to fund the deposit for the property you're buying. There are some mortgage lenders that will now allow a smaller deposit (5%) and also help with the fees. There are also schemes that will help first time buyers if they are not able to stump up the deposit. 

2. Legal fees

After you've found a property you want to buy and the seller has provisionally accepted your offer, you should contact a solicitor or licensed conveyancer as a matter of priority to begin the legal process of buying your home.  Conveyancing costs can range from around £200 to £1,500, depending on the work involved and the value of the property. A solicitor will also charge for any additional costs they incur (called 'disbursements'), like postage, VAT, etc.

3. Stamp duty

You have to pay Stamp Duty Land Tax (SDLT) if you buy a property in the UK over a certain price. This is charged on all purchases of houses, flats and other land and buildings.

Different rates apply in Scotland from 1 April 2015 when Land and Buildings Transaction Tax (LBTT) replaces SDLT.

The SDLT rate depends on:

  • the purchase price of the property
  • whether the property is residential

SDLT may also be due if you lease a property.

SDLT rates from 4 December 2014

SDLT is charged at different rates depending on the portion of the purchase price that falls into each rate band.

Before 4 December 2014, SDLT was charged as a single percentage of the property price.

Where contracts have been exchanged on or before 3 December 2014, and the transaction is completed on 4 December or later, you can choose whether you follow the new or the old rules.

Residential properties

Purchase price of property Rate of SDLT (percentage of the total purchase price)
£0 - £125,000 0%
£125,001 - £250,000 2%
£250,001 - £925,000 5%
£925,001 - £1.5 million 10%
Over £1.5 million 12%

Additional 3% SDLT Second Properties

If your are already a home owner and looking to purchase an additional property, you will be liable for an additional 3% stamp duty on the property being purchased. You will have 36 months to reclaim this additional payment if you sell the additional property withing this period.

Corporate bodies

SDLT is charged at 15% on residential dwellings costing more than £500,000 bought by bodies like:

  • companies
  • collective investment schemes

There are some exceptions. For example, you pay SDLT based on the new rates and bands where the property is used for:

  • a property rental business
  • a property development or resale trade
  • providing admission to visitors on a commercial basis

Residential leases

If your residential lease is for more than £125,000, you’ll pay 1% SDLT on the amount above the £125,000 threshold.

Non-residential and mixed-use properties

Purchase price/lease premium or transfer value Rate of SDLT (percentage of the total purchase price)
Up to £150,000 - annual rent is less than £1,000 Zero
Up to £150,000 - annual rent is £1,000 or more 1%
Over £150,000 to £250,000 1%
Over £250,000 to £500,000 3%
Over £500,000 4%

4. Survey costs

If you need a mortgage, your lender will ask you to pay for a mortgage valuation report to confirm that the property is worth the amount that you have asked to borrow. The cost of a basic mortgage valuation is approximately £100 to £300, depending on the size and cost of the property.  For added protection, most buyers pay for a more comprehensive survey to be done, either a homebuyer's report or a full structural survey. A homebuyer's report costs about £300 to £600, whilst a full structural survey is likely to cost anywhere upwards of this, again depending on the property.

5. Mortgage application fee / arrangement fee

Mortgage application fees are set and charged by the mortgage lender. These fees are usually scaled so you will need to ask your mortgage professional to work out what the best deal is for your circumstances. 

6. Mortgage indemnity insurance

If you borrow a high percentage of your property's value (i.e, over 75% to 90%), your lender may ask that you obtain mortgage indemnity insurance to cover you if you can't keep up the mortgage repayments. Expect to pay roughly £1,500 per £100,000 of the purchase price.

7. Buildings and contents insurance

Your mortgage lender will insist that you take out buildings insurance, so that its investment is still safe in the event that your home burns down or some other calamity occurs.  Your mortgage professional will assist you in setting up the best suited policy for your specific needs and circumstances.

8. Insurance penalty

Some lenders require that you buy their buildings insurance and will impose a £25 penalty fee if you refuse and buy it elsewhere.

10. CHAPs fee

Some lenders charge approximately £30 to cover the telegraphic transfer fee involved in transferring the lender's money to your solicitor.

11. Search fees

Solicitors generally recommend around five searches, which altogether cost about £300. You may need more depending on the property and area you're buying in. Expect to pay £50 for each additional search.

12. Land Registry fee

After you move, you will need to pay a fee to the Land Registry to register the new change of ownership. The size of the fee depends on the purchase price of the property. 

These are the Scale 1 fees:

Scale Fee
Up to £80,000  £20
£80,001- £100,000 £40
£100,001-£200,000 £95
£200,001-£500,000 £135
£500,001-£1,000,000 £270
£1,000,001 and over £455
£1,000,001 and over £700



A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.



Additional Costs Involved When Selling Your Home

1. Estate agent fees

Standard estate agent commission is around 1.5% to 3% of the sale price.

2. Legal fees

As stated in General Costs & Fees, conveyancing costs can range from £200 to £1,500 plus VAT, depending on a number of factors (e.g., the cost of the property, complexity of the transaction, etc).

3. Early repayment charge

If you are tied in to an initial rate or took advantage of a deal through your mortgage lender, you might have an early repayment charge on your mortgage contract. The charge can be as high as 1% to 4% of the outstanding loan.

4. Exit fee

Another charge levied by mortgage lenders, this time when you finish paying off your mortgage or switch your mortgage to another lender. The fee may be as high as £300 in some cases.

5. Indemnity insurance

An indemnity policy is a type of insurance taken out to deal with a defect in the title of the property being sold (e.g., a restrictive covenant or a missing document of title). As a way to complete the transaction, but also satisfy the buyer, your solicitor may suggest you take out an indemnity policy, which will pay the buyer if the defect becomes a problem. All such policies require that their existence not be disclosed to third parties.


A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.

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