What you need to know when buying your first house
Buying your first property is an exciting time, but there are some things you need to know about finance before searching for your dream home.
Check up on your savings
Remember when all your money was stored in your piggy bank? Nowadays, you may have money in different bank accounts all over the place. Or maybe you keep some cash stashed in your sock draw?
When it comes to buying your first house, lenders usually want to know you’re able to resist impulse spending and save up a decent chunk of money to put towards your home deposit. So, plan ahead – at least six months – before applying for a home loan to demonstrate you’re able to save AKA afford a house.
Once you’ve shown you’re able to save, save, save, lenders may offer to lend you a percentage of the house’s purchase price to help you buy the property. You might even be able to include mortgage insurance costs in your loan.
Find out how much you’re allowed to borrow
Finding out how much money you’re allowed to borrow to buy a house may be a bit confusing. That’s why it’s important you work with a Home Loan Specialist (AKA mortgage broker) like me to arrange pre-approval for your home loan before looking at any houses.
Yes, it’s tempting to look online and pick apart the kitchen and wall colours of advertised properties. But you need to know how much you’re able to spend before you look at homes. You should also find out the lender’s t&c’s so you know exactly what you’re agreeing to before they hand over the money.
Need a hand figuring out how much money you may borrow? Let’s chat about your options.
Understand the fees and costs of a mortgage
Nothing in life is free, and certainly not a mortgage. Your parents may have allowed you to borrow $10 and repay them $1 per week with no interest, mortgage lenders aren’t so generous.
As a buyer, you need to understand the fees and costs involved with getting a mortgage.
These may include things like:
Deposit
Stamp duty
Loan set up fees
Lender’s mortgage insurance
Conveyancing
Settlement fees
Valuations
Inspection costs
Home insurance
Does that seem like a lot to consider? That’s why home loan specialists.
Government grants and incentives for first home buyers
Where you live may influence what government grants and incentives are available to help give you a leg up when buying your first property. Find out what you may be eligible for and note any deadlines and conditions you need to meet. Also, ask your mortgage broker questions – they may know of a new first home buyer opportunity.
As a first home buyer you may be able to apply for:
• First Home Savers Account
• Reduced Stamp Duty
• First Home Owners Grant
Check out the government’s First Home website for the most recent information.
Why first home buyers should work with a home loan specialist
Buying your first home is exciting, but there is so much you need to organise and understand before buying. I’m the helping hand for first home buyers – I explain the confusing stuff, so you know exactly what you’re signing up for when buying your first home.
Are you ready to buy your first home? It’s time we had a chat.
Disclaimer: This is general information only and is subject to change at any time. Your complete financial situation will need to be assessed before acceptance of any proposal or product.