Deposit 

When contracts are exchanged a deposit is usually required and paid through your solicitor. This is a percentage of the purchase price arranged with agent and vendor - usually between 5% and 10%.

To ensure that the property is an acceptable security for a loan, the mortgage lender's surveyor will need to inspect and value the property. The cost, if any, of this valuation depends upon which lender you choose.

Usually a solicitor or licensed conveyancer needs to be appointed to deal with the legal aspects of purchasing a property. This will incur costs. You can ask for an estimate of these costs before you instruct the legal expert.

Your legal adviser will carry out a local authority search to discover if there are any plans for future developments that could affect the value and purchase of your chosen property.

This verifies legal ownership of the property and registers the owner at that address.

This is a government tax based on the property's purchase price and is calculated as follows: Up to £120K - Nil, £120K - £250K - 1%, £250 - £500K - 3%, 500K+ - 4%.

Most lenders charge an arrangement or application fee for a mortgage. Some lenders will allow you to add this to the mortgage and the fee varies depending on the lender chosen and the mortgage offer.

This is an insurance policy designed to protect the lender against losses incurred if the property needs to be taken into possession because of arrears. This insurance is commonly used for high loan to value mortgages, where the value of the property is not much more than the requested amount of the loan. This charge is usually passed on to the borrower but it is important to remember that this is insurance for the lender, not the borrower, but paid for by you.

Lenders insist that the property is adequately insured with a suitable buildings insurance policy, covering against usual risks. in addition to this you will need contents insurance to cover theft, damage etc. Another form of insurance is a mortgage payment protection plan that is designed to offer income protection against unemployment, sickness and redundancy.

Most lenders require Life Assurance to be taken out to cover the value of the loan if you die. One of the following is usually necessary.

Term Assurance is the cheapest and simplest form of life cover, providing life assurance for a fixed term only. The sum assured is payable only if the life assured dies within that period. There is no investment value to the policy at any time.

Level Term Assurance the sum assured does not change during the term of the policy. Such policies are generally used to repay a loan on the death of the borrower (the life assured). Level Term Assurance is most suitable when the loan has a fixed capital value that remains unchanged throughout its term. Policies can be written on a single life or on a joint life basis.

Decreasing Term Assurance policies are ones where the sum assured decreases over the term  of the policy in step with the reducing balance of the loan. This type of policy is commonly used to protect a capital & interest repayment mortgage, where the outstanding balance reduces each year.