Tips for First Home Buyers
Here are our top tips for you when buying your first home. These pointers will ensure that the journey into home ownership runs as smoothly as possible.
1) Plan a budget
Planning a budget ensures that you know how much you can afford for your first home, and helps you to plan for the extra costs too such as legal fees and moving costs. Make sure you include a buffer, so if interest rates go up you can afford the extra repayments. Buying your first home is rewarding and exciting but planning now will serve you well in the future.
2) Decide on your limits
The Great Australian Dream – owning your own home. But do you need four bedrooms? It is really necessary to have brand new furniture? For your first home, you may have to re-consider your needs and wants. Of course everyone wants the best, but sometimes as a first time home buyer you may need to consider a smaller property or perhaps a property further out of town. In order to make your property a sound investment it is important to borrow within your limits, and sometimes this means readjusting your property ideals.
3) Apply for the First Home Owners Grant.
Check how much you are eligible for with the First Home Owners Grant. You can apply for the First Home Owners Grant by visiting the Office of State Revenue in your state. The easiest way is to download the forms, fill them out and submit. Your mortgage broker will be able to help you with the application and ensure all the necessary paperwork is in order.
4) Look into a First Homebuyer Savings Account
If you are thinking for the future consider a First Home Savers Account. You have to hold the account for a minimum of four years and you must deposit at least $1000 each financial year, but the government contributes 17 cents for every dollar you save. Who would turn down extra money? You can still claim the First Home Buyer Grant, so you have nothing to loose.
5) Check out the Stamp Duty
Stamp Duty charges vary from state to state, and there are different concessions for first homebuyers depending on the value of the property and which state the property is in. You can check this by clicking here:
6) Avoid other forms of debt
Credit cards, car loans, store cards… they are all debts, and they all affect your credit score. They also limit your ability to pay off your home loan, because you are still directing funds into these other loans. Potential interest rate hikes also need to be factored in. Most people who are currently having their homes repossessed were only just getting by' and couldn't afford any increased payments.
7) The bigger deposit you have the better
The bigger deposit you have, the less you borrow, and the more principal you are going to be paying back early. Borrowing 100% because you do not have a deposit saved will cost you much more in interest over the years. The aim of the game with mortgages is to reduce the amount of interest you pay. You can do this by not borrowing more than 80% of the purchase price, and by repaying the mortgage at a higher rate than the monthly minimum payment.
8) Get advice from a mortgage broker, lawyer or an accountant.
If you haven’t yet enlisted the help of a financial broker, then now is the time. A good mortgage broker is a great place to start, as mortgage brokers understand the property market and can assist to not only find you a great home loan, but can also get you fast approval and help with the paperwork side of everything. A mortgage broker helps you from start to finish, saving you a lot of time and effort.
9) Is the property sound?
Before you sign a contract it is advisable to have the house inspected for defects and problems. The Royal Institute of Architects can give you a pre-purchase inspection report for a set fee. See www.architecture.com.au
10) Contents Insurance
Home contents insurance provides financial protection against damage to, or the loss of, contents in your home. Having proper insurance means that should there be major damage or complete loss of your home you can get repairs or replacements easily. There are several good insurers who you can choose a plan from. Talk to your mortgage broker to find out the best insurers in your area.
11) Find Your Perfect Home
Making the selection when searching for your first home can prove difficult. You may look at several properties in one day and then more the following weeeked. Remembering them all, with all their positives and negatives can be hard. Taking a digital camera, making notes of unusual features, colours and design elements and considering whether you like the location are all must do’s one the day of viewing. Ask to see your favourite properties a second time, so you can look with fresh eyes and make more rational judgements. If you are really keen on a property, call the agent to double-check that an offer hasn't come in, and to find out more about why the owner is selling.
If you are ready to buy, and have already found your dream home, we can help. Call us today on  to talk to a mortgage broker in your local area. Alternatively, submit your details via our website and we will call you back at a time that is convenient to you.
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| Here is our checklist to help you get organised. | Choosing the right first mortgage will be easy once you read our guide. | Are you a first time home buyer? Make sure you don’t get caught out. |
First Home Grants
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Get the Most out of your FHOG
The top five ways to maximise the first home owners grant and get the true benefits. |
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What you you wanted to know about FHOG but were too afraid to ask! |
Buyer beware! Top 4 mistakes first home buyers make and how to avoid them.
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We have clever strategies to make home ownership more affordable. |
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First home buyers need to be extra careful when it comes to a first mortgage. .
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