Buying your first home is a very exciting time however it is a huge financial investment. There are certain things you should know before you start searching for your new home. We have put together five tips to help guide you through the process.
Do a budget
Start with a budget to see how much you can afford to borrow. Work out what the mortgage repayments will be. Don’t forget you still want to be able to live your life, so a clearly defined budget will allow you to do both.
Save a deposit
Make sure you know how much you need to save and what price bracket you can afford to buy in. As a rule of thumb, 20% of the purchase price is a good size deposit meaning that you won’t need to pay lenders mortgage insurance or what’s known as LMI. LMI protects the bank or financial institution from losses such as you the borrower not being able to make your home loan repayments. The more you are able to save as a deposit the less your LMI will be.
Costs of purchasing a home
Consider other additional costs that come with owning a home. Include the cost of lenders mortgage insurance, solicitors’ fees, and stamp duty.
Find the best home loan
Shop around, there are lots of different banks and financial institutions that supply home loans, or you can use a broker to help you get the best deal.. Get a pre-approved loan. This will mean you are looking at the right houses within your budget. If you see your dream home, you will be able to snap it up. Most pre-approvals are valid for 90 days; however, this doesn’t guarantee you for the full loan, there are other credit assessments requirements.
Control emotions
Don’t let your emotions take over when you get to the buying stage. Consider the property and suburbs you can afford to buy in. Do your research, talk to Sales Agents in the area and gain an understanding of the market. Spend time in the area to see if it is going to meet your needs.
The Accolade Sales Team can provide helpful guidance for new home buyers across all aspects of the building journey. The new estate located in Rockbank in Melbourne’s west has a range of house and land packages available with a 5% deposit. Call the team on 1300 268 629 to discuss your options.
There are two government incentives currently available to assist people buying a new home with the HomeBuilder and First Home Owner Grants.
