5 Tips For First Home Buyers
It is quite a significant milestone when you buy your first home and, like most big decisions in life, we usually take careful consideration and strategic planning before arriving at the final outcome. If you are about to take the leap into homeownership, we’ve put together some important factors to consider. Here are our essential tips for first home buyers.
Set your self up for a good credit score
A credit score, which reflects your repayment history, could affect your ability to get loan approval. These are based on your history of paying previous loans, bills and the number of times you have applied for credit. These include all of your credit cards and money owed, even Afterpay and Zip-pay accounts can have an impact. If you have a low credit score it could, unfortunately, shorten your list of potential lenders, this is one of the many reasons it pays to be in control of your debt.
Read up on deposit rules
It is worth familiarising yourself on the rules surrounding home loan deposits. Most potential first home buyers are generally expected to have a deposit of 20% of the amount they intend to borrow. Unless you’re killing it in the income department, to the average joe, that can be a substantial amount of money. Fortunately, there are ways around this. If you put in a bit of research, you can likely find a lender that will allow for a 5% deposit. However, lenders mortgage insurance may be required. Find out more about LMI here. Your First Home hero manager will help you find a lender that meets your requirements.
Take advantage of financial or government assistance
There are a number of ways you may be able to help fund your future home. First up, if you are wanting to buy a new home, it’s worth checking out house and land packages, you may be surprised by possible deals and this would get you a better grant. If you are building in QLD we can organise a package for you, and arrange even further incentives. We are currently matching the first home owners grant by offering all eligible first home buyers $15,000 towards a deposit. Apply for one of our packages here. If you add this to the current Home Builders grant of $25,000, you are left with a decent amount of money to put towards homeownership ($55,000). I mean why not save yourself thousands and provide up to 100% of your deposit.
Team up, two are better than one
Teaming up with either a partner, friend or family is another potential option if you don’t think you can achieve finance on your own. Two incomes make your chances a whole lot better and make the deposit a whole lot smaller when shared. Even if you are single, is there a friend or family member who might want to buy with you? However, keep in mind to be eligible for the government incentives touched on above, you will both have to be First Home Buyers and it would need to be your primary residence.
Get your finances in order so you’re ready to go
Pre-approval is a good idea when entering the property market so you know exactly what you are able to borrow, as home loan approval time can vary. You’ll also need to have your deposit ready to go. The best thing to do is chat to a mortgage broker and get an understanding of what is needed. You can chat to one of ours for free, apply here.
First Home Hero helps Australians escape the rental trap. If you would like to have a chat with one of our specialist about what we have on offer, get in contact here: https://firsthomehero.com.au/