When you come to pay off your existing mortgage, whether that through selling or re-mortgaging your property, we will need to pay off the existing charge placed on the official copies by your lender. In order to find out the balance remaining, we will need to request a redemption figure from the current lender. Mortgage redemption statements are usually only valid for 4 weeks. If for some reason the redemption is postponed beyond the designated day of completion as new statement will need to be requested.
A redemption figure consists of the following:
- The remaining balance left on your mortgage.
- Any interest that will be charged until the date of the redemption.
- Any mortgage redemption fees (admin fees for closing the mortgage).
- Any early repayment charges.
Working out your specific mortgage amount is complex and will differ from lender to lender. Your lender may have an online mortgage redemption calculator that you an access in order to work out exactly how much you owe.
Do I have to pay Stamp Duty for my Property as a First Time Buyer?
The current stamp duty threshold is £125,000.00 for residential properties and £150,000.00 for non-residential properties. However, these rules have now changed for first time buyers as a result of the 2017 budget. From 22nd November first time buyers will no longer qualify for stamp duty when buying a property of up to £300,000.00. This change will apply to those buying properties in England, Wales and Northern Ireland but not Scotland.
The change takes place with immediate effect however if completion of your purchase was prior to 22nd November the old rules still apply, so any first time buyers who completed before then are still required to pay stamp duty as long as the purchase price is more than £125,000.00 for residential properties and £150,000.00 for non-residential properties.
If you are buying as joint owners and only one of you is a first time buyer stamp duty will still have to paid as both persons will be on the title. If you have ever owned or part owned a property you will also have to pay stamp duty.
Stamp Duty Land Tax versus the new Land Transaction Tax for Wales
You must pay Stamp Duty Land Tax when you buy a property over a certain price in England and Wales.
In 2018, for the first time in 800 years, the Welsh Government will be responsible for raising a proportion of its own revenue to spend on public services. One way the Government propose to do this is with the replacement of Stamp Duty Land Tax with Land Transaction Tax.
Although the changes will, according to the Welsh Government, mean that nine out of ten buyers will pay the same or less, there will be big winners and big losers.
The Current Stamp Duty Land Tax Rates:
The New Land Transaction Tax Rates in Wales:
Up to £125,000 - No Tax
Up to £150,000 - No Tax
£125,001 - £250,000 - 2%
£150,001 - £250,000 - 2.5%
£250,001 - £925,000 - 5%
£250,001 - £400,000 - 5%
£925,001 - £1.5 million - 10%
£400,001 - £750,000 - 7.5%
Above £1.5 million - 12%
£50,001 - £1.5 million - 10%
Above £1.5 million - 12%
What this means:-
The biggest winners will be people buying small first homes in Wales:
On a house of £150,000, you will not pay any tax - compared to £500 in England.
On a house of £200,000, you will pay £1,250 - compared to £1,500 in England.
Anyone buying a house between £250,000 £400,000 will pay the same in England and Wales. This is £2,500 on a house £250,000 rising to £10,000 on a house of £400,000.
If you are buying a house worth more than £400,000 in Wales, you will pay a higher rate of tax:
On a house of £500,000 you will pay £17,500 in Wales - compared to £15,000 in England
On a house of £600,000 you will pay £25,000 in Wales - compared to £20,000 in England
On a house of £750,000 you will pay £6,250 in Wales - compared with £27,500 in England
The biggest losers will be people buying houses worth more than £750,000 in Wales:
On a house of £925,000 you will pay £53,750 - compared £36,250 in England - a difference of £17,500!
Anyone buying a second home will pay an additional 3% on the value of the property - the same as currently.
These changes are expected to come into force on 1 April 2018.