Managing my money

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# 6.1.4 How much does it cost?

This quiz tests your ability to calculate the costs of buying a home.

## Activity 1

An offer of £150,000 on a property has been accepted. The following costs apply:

 Legal fees £500 Valuation survey £250 Structural survey £750 Arrangement fee to the mortgage lender £250 Removal costs £1000 Stamp Duty Land Tax paid at 1%

How much does it cost in total to buy and move into this property?

a.

£150,000

b.

£154,250

c.

£152,750

d.

£151,500

The correct answer is b.

b.

Well done. The total costs are as follows:

Cost of property £150,000

Stamp Duty Land Tax (£150,000 x 1%) = £1,500

The other costs are £500 + £250 + £750 + £250 + £1000 = £2750

The total cost of buying the property is therefore £150,000 + £1500 + £2750 = £154,250

An offer of £150,000 on a property has been accepted. The following costs apply:

 Legal fees £500 Valuation survey £250 Structural survey £750 Arrangement fee to the mortgage lender £250 Removal costs £1000 Stamp Duty Land Tax paid at 1%

What are the extra costs (excluding the property price) as a percentage of the property purchase price?

a.

2.83%

b.

2.76%

c.

0.28%

d.

3%

The correct answer is a.

a.

Well done!

The extra costs are (£4,250 /£150,000) × 100= 2.83% on top of the cost of the property.

MMM_1

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