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Buyer’s Guide

Buying a house is one of the biggest decisions you’ll ever make.

It’s not just a financial consideration but also a lifestyle one; you want to make the right decision for your finances, your loved ones and yourself.

Buying your first home will be an exhilarating and rewarding experience. At the end of your property-buying adventure, you’ll have the keys to a home to call your own and an investment for your future.

How do you go about selecting the right property for you? You could follow these questions as a guide.

  • In which suburbs would you most like to live?
  • Do you like the neighbouring suburbs?
  • Are local schools a consideration?
  • What’s the proximity to shops, sports, facilities, cafes, restaurants, etc?
  • What are the dream features of your home?
  • Is a garden or balcony important?
  • How many bedrooms do you need?
  • Do you need a garage?
  • How much work is required? Are there any major renovations needed?

Before going out into the marketplace to find your dream property, the following checklist may be useful in getting you in a position to confidently bid or make offers on your property of choice.

  • How much are you willing to pay upfront to secure your home? The simple truth is that the more deposit you pay, the more likely you are to get a loan. The Australian Securities and Investments Commission recommends having a deposit of 20% of the purchase price of your anticipated property. Some states will allow as little as 5% for a deposit. Of course, it depends on your lender and their rules, as well as your financial situation.
  • Are you eligible for the First Home Owner Grant in your state?
  • Building and pest inspections are not compulsory, however, it is a good idea to get an inspection done in case of any hidden costs you may have to pay once you have bought the property, that may not be visible.
  • Research Loan establishment fees, legal fees and stamp duty – these all vary from state to state and providers.

Four steps to securing your home loan:

  1. Set your goal: Once you know the type of property you want, and have a rough idea of what it is likely to cost, set yourself a target for saving your deposit. Remember, if your deposit is less than 20% you may need to pay Lender’s Mortgage Insurance, or get a guarantor to offer their property as security.
  2. Talk to a broker:  Before you start actively looking for a property, it’s worth speaking to a broker. They’ll give you an accurate assessment of your borrowing capacity (more accurately than an online calculator) and they will determine your eligibility for government grants. Your broker will explain all the government fees and charges and ensure you’ll be eligible for a loan when the time comes to buy.
  3. Get the green light: Whether you’re bidding at an Auction or placing an offer with an agent, you’re in a stronger position with a pre-approval. Pre- approval is essentially a green light from a lender to spend up to a certain amount. This means you’ll know how much you’ve got to work with. You’ll usually receive pre-approval within a few days of application. It’s generally valid for 3-6 months, and assumes your financials will remain the same during that period of time.
  4. Close the deal: Whether you buy at Auction, by Private Sale or off-the-plan, securing a property is cause for celebration. But before you pop the champagne, you’ll need to move fast to organise a few important things:
  • A holding deposit or 5-10% of auction purchase prices
  • A solicitor/conveyancer – your broker or agent can recommend someone they trust to take care of the legal work
  • Notify your broker – So they can quickly move you along to the formal approval.