Buying your first home

We understand that buying your first home is one of the biggest financial decisions you’ll make in your life. Though we can’t lessen the pressure of an auction or the anxious moments waiting to see if your offer has been accepted, we think we can take the grief out of the finance. This is why we’ve taken the time to walk you through what can be a complex and time consuming process. We’ll help you understand the steps you need to take to experience the excitement of owning your own home.

Before you buy

Before looking for your first home you’ll need to do some preparation, to make sure you’re ready to make the commitment to home ownership:

  • Budget and save – Your deposit is one of the biggest factors that determines how much you can borrow from your bank. Setting a budget and saving as much as possible for your deposit and fees will help you reduce the amount you need to borrow to purchase your first home.
  • Get some advice – When you’re entering the market for the first time, a good place to start is by meeting with a mortgage broker or credit professional. They can explain the home buying process and advise you on aspects of borrowing you may not be aware of. A mortgage broker or credit professional will outline what you can afford, inform you of the costs of borrowing (Lenders Mortgage Insurance (LMI), stamp duty and mortgage protection insurance) and direct you towards a product that suits your needs. Once you’re comfortable with a product, they can start the loan application process, so that when you find the right home you’re ready to go.
  • Do your research – Find out if you qualify for any first home buyer benefits and how much you’re entitled to on the Federal Government’s first home buyer website (www.firsthome.gov.au). Make sure you check what other fees are payable at the purchase of a property (Government stamp duty, solicitor’s fees, etc.).
  • Set a price before looking – Work out how much from each pay you want to set aside for your repayments before you start looking for a house. Use this repayment figure in our loan calculators to determine how much you can borrow. You should combine this with the advice from your mortgage broker or credit professional to give you a figure you’re comfortable with.
  • Start looking – Now comes the fun part. With your budget in place and your mortgage broker or credit professional getting your application up and running in the background, it’s time to start looking. You can start by contacting real estate agents, searching through newspapers, scouring the Internet or just driving through your desired suburbs, looking for houses for sale until you find the one that is just right.

Things to consider

Here are some handy hints to remember when buying your first home:
  • Legal advice – While you’re able to act on your own behalf when purchasing a property, the documentation and settlement process can be quite complicated and includes many legal requirements. Buying a home is often the biggest purchase you’ll ever make and it’s strongly recommended that you use the services of a solicitor or conveyancer. They’re experts in this area, and they’ll ensure that everything runs smoothly and is completed correctly.
  • Take a good look – You want to make sure you don’t get any nasty surprises after you move in, so you need to give any prospective properties a thorough inspection before committing to the purchase of a property. Some tips include inspecting the property multiple times at different times of day, visiting on a rainy day to check for any leaks in the walls or problems with the guttering, and looking under carpets and rugs to check the state of the floorboards underneath. You should also check on the other side of the bathroom walls to make sure there are no signs of water damage and to see whether the walls or ceiling show any cracks or signs of movement.
  • Arrange a professional inspection – You should organise a building or pest inspection. While this may cost a little up front, an inspection could help you avoid getting hit with much higher costs from unseen problems in the future, which were not obvious to the untrained eye.
  • Know what you want – Sit down and work out what you do and don’t want from the house you buy, so you have a list you can work through when you inspect properties. It helps to split this into a list of ‘must have’ and ‘nice to have’ features, which may make the decision easier if you’re weighing up one house against another.
  • Insurance – There are three types of insurance policies that you may need to consider when buying your first home; home insurance, Lenders Mortgage Insurance (LMI) and loan protection insurance: 
    • Home insurance will cover your new house (this can also be home and contents insurance) and is compulsory for any loan to be approved, however, you should look for policies that provide free cover from when you sign the contract up until the day you move in.
    • LMI is offered by an external provider and enables you to buy a home with less than a 20% deposit. An up-front fee (or premium) is paid to the external provider, which insures your lender against default on your home loan.
    • Loan protection insurance is a policy that covers you for situations that may arise in the future, which affect your ability to pay back the loan (e.g. death, disability or unemployment for anyone attached to the loan).

arrow-left.gif The lending process


Our suggested products 


SmartSaver

A basic home loan with a competitive variable rate and no monthly fees. SmartSaver has the flexibility of redraw, voluntary repayments without penalty and a choice of principal and interest or interest only repayments.

Download the SmartSaver fact sheet

SmartFit

A fully featured variable home loan with a 100% offset account to maximise the benefits of any savings you build up by reducing the interest charged on your home loan. The SmartFit loan also offers interest only repayments of up to 7 years for Owner Occupied or up to 10 years for investors looking to pay back only the interest incurred on the loan.

Download the SmartFit fact sheet

SmartFix

A fully featured home loan with the option to fix your interest rate from one to five years, with a 100% offset account. The locked in repayments over your fixed term allow you to take control of your budget, while still benefitting from the interest offset for any savings you build up. The SmartFix loan gives customers the choice of making interest only repayments to allow investors to pay back only the interest incurred on the loan.

Download the SmartFix fact sheet

SmartDoc

A home loan which allows self employed customers to sign an income declaration form with accountant verification, instead of providing proof of income documentation. The SmartDoc loan comes with a fully featured 100% offset account to reduce the interest charged and the option of interest only repayments of up to 7 years for Owner Occupied or up to 10 years for investors to minimise their costs. Variable and fixed interest rates available.

Download the SmartDoc fact sheet