- Posted 07 Apr
- 0 Comments
It’s an extremely exciting time… you’re considering buying your first home! You’re ready to stop paying your hard earned money to live in someone else’s house and you want to paint those wall’s any colour you feel like.
But there are a lot of factors to consider before committing to such a big investment. A lot of responsibilities come with owning a home, so it’s wise to do your research and get yourself as educated as possible about the entire process.
It can be quite overwhelming, so here at Australian Credit and Finance we have provided a few items to consider to get you started on your way to the very rewarding and fulfilling status of being a home owner.
1. Home Loan Deposit
Make sure you have saved up or have the ability to put down at least 5% of the total cost of the home. This is a minimum that lenders would even consider, so 10% or higher is recommended. The more you are able to put down the better position you will be in and the lower your monthly mortgage repayments will be.
If coming up with a large sum is difficult, there are some options for first time home buyers. Talk with your parents and relatives about your desire to purchase a home. A lot of family’s like to support and assist with this big first move and might be able to gift you money or use equity in their home to help you out. Also there might be a stamp duty concession that would reduce your costs. Check with your state regulations for more information.
2. Savings and Stability
In order for some lenders to feel comfortable lending such a large amount of money, they want to make sure that you have a long savings history and that you have the ability to pay for all the other costs that come with buying a property. You may be able to show this simply by your ability to have the amount for the loan deposit.
Long term and stable employment is favourable as well. Consistent income lets vendors know you will be able to pay the loan back and all other costs involved with owning a home.
3. Importance of Credit History
Being an informed and responsible consumer will fare well for you before you apply for a loan with a lender. There are many options and websites to check your credit score and make improvements and changes if there are things on your credit you didn’t know were there or that you don’t agree with. Sound credit history is a major deciding factor when lenders are looking to loan to you.
4. Free Money! Government Grants
Purchasing homes helps with our economy and therefore local government agencies have tried to come up with grants to help people do so. It is worth doing some research and seeing if you might qualify for a grant to purchase a first home.
5. Know Your Borrowing Limits
At Australian Credit and Finance we help you get pre-approved for a home loan so you know the home purchase price range you fall in. It will save you heartbreak from falling in love with a home you can’t be approved for and also speed up the process when you do find your dream home and want to move fast on it.
If you’re ready to start looking at your first home but need help with finding the right home loan finance for your needs, chat to our team of experienced home loan experts today.