Purchasing your first home is an exciting time, but it can also be a very daunting process. Where do you begin? There are your finances to consider, finance jargon to translate, and documents to prepare, among the long list of tasks you have to cross out before you can finally settle in your property. Before you start stressing, we are here to offer 3 important pieces of advice that can help you get started:
1. Get a handle on your finances and know how much you can afford.
It is important to remember that purchasing your first home costs a great deal of money and is often the biggest investments of your life. It is important to determine how much savings you currently have, and how much you can afford when it comes to monthly repayments. Savings are important because lenders often require you to show genuine savings in the past and often require a minimum of 10% deposit to secure your home loan.
Getting these finances in order before you take out a home loan will save you a lot of stress and money over the life of your loan. The last thing you want to do is take on a loan that you can’t afford and end up defaulting on the loan leading to extra charges. Your mortgage broker will work with you to put together a budget that takes into consideration living costs and other repayments you may have, like car repayments to work out exactly how much you can afford each month.
2. Put a plan in place.
Planning is key when it comes to home loans. It’s a good idea to have a plan in place before you actually take out a loan. This will give you enough time to save up for the deposit and show genuine savings.
If you want to take out a loan sooner, but haven’t saved up enough money yet, speak to one of our brokers about your other options including having a guarantor or paying lenders mortgage insurance (LMI).
3. Seek professional advice.
Being a first time buyer can be confusing and difficult and this is where a mortgage broker can help alleviate some of this confusion and stress. We work with you to factor in your finance goals and your personal circumstances to help you work out what you can afford. We also put you in touch with our network of lenders to offer you a variety of loan products and translate any finance jargon that you may come across in your paperwork.
Not only is there all of this to consider, but when it comes to interest rates, which is best? We can talk you through the pros and cons of each and help work out an outcome that is most suitable for your personal situation.
If you or someone you know is looking to take out a loan or just looking for some advice, get in touch with us today to book an appointment and we can answer any questions you may have.