Buying my first home

It can be hard to know where to start when you’re looking for your first home and working out how to fund it. Here are some tips to help you.

Before you buy

  • Budget and save

    Your deposit is one of the biggest factors in determining your borrowing power. Setting a budget in order to save as much deposit as possible will reduce the amount you need to borrow.

  • Get advice

    Talk to a mortgage broker or credit professional who will explain the home buying process, including aspects you may not be aware of. They’ll provide their opinion on your current situation and advise you about the costs of borrowing (such as Lenders Mortgage Insurance (LMI), stamp duty and mortgage protection insurance). They’ll also let you know how much you can borrow and advise you about suitable loan products. Once you’re comfortable you’ve found the right loan, your mortgage broker or credit professional can get the application process started with you.

  • 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. Also make sure you know what other fees are payable when purchasing a property including stamp duty, solicitor’s fees etc.

  • Set a price before looking

    Work out the amount from each pay you can set aside for repayments . Your mortgage broker or credit professional will help you get to a figure you’re comfortable with.

  • Start looking

    for your new home!

Things to consider

  • Legal advice

    While you can act on your own behalf when purchasing property, the documentation and settlement process can be quite complicated and includes many legal requirements. We strongly recommend you use the services of a solicitor or conveyancer. These experts will ensure that everything runs smoothly and is completed correctly.

  • Take a good look

    When you’ve found a home you like, give it a thorough inspection before committing to purchase. It’s a good idea to inspect the property a number of times at different times of the day. If you can, visit on a rainy day to check for leaks in the walls or guttering problems. Look under carpet and rugs to see the state of the floor beneath. Also check on the other side of bathroom walls for water damage and take a good look around for cracks or signs of movement on ceilings and walls.

  • Arrange a professional inspection

    Organise a building and pest inspection. While they’ll cost a little upfront, inspections by trained professionals could help you avoid much higher costs in future.

  • Know what you want

    Work out a list of what you want (and don’t want) from the house you buy to work through when you inspect properties. This will help you decide on must-have and nice-to-have features which could help when weighing up one house against another.

  • Insurance

    You may need to consider three types of insurance when buying your first home; home insurance, Lenders Mortgage Insurance (LMI) and loan protection insurance.

    • Home insurance (also home and contents insurance) is compulsory for any loan to be approved. 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) paid to the external provider insures your lender against default on your home loan.
    • Loan protection insurance covers you for situations that may arise in future that could affect your ability to pay back the loan (e.g. death, disability or unemployment of anyone attached to the loan).

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