Purchasing property for the first time is probably one of the most important steps you’ll ever take in your life. But as exciting as the road to homeownership can be, it can also be quite daunting. That’s why it pays to be prepared. To help you, here’s our top tips for buying your first home in Perth.
Buying a home is the biggest purchase most Australians will make in their lifetime and many of us need advice along the way. In terms of finance, it’s easy to be overwhelmed with confusing terms and jargon often used by lenders when organising a home loan. That’s where your mortgage broker steps in.
A mortgage broker is a person or company that arranges mortgages between borrowers and lenders. Think of them as the middleman between yourself and the bank when buying a home. They’ll help you find the best home loan product for your specific needs and budget, making the home buying process much easier.
Aside from helping you securing the most suitable loan, some of the other reasons to reach out to a mortgage broker at the beginning of your homeownership journey include:
1. Save Money
A mortgage broker can help you assess how much you can afford in order to select the best home loan for your circumstances. All you have to do is fill out a few details and the hard work is managed by an experienced professional who has your best interests in mind.
Additionally, many brokerage services are now free of charge. So you have nothing to lose by taking the opportunity to compare thoroughly and widely across multiple lenders.
2. Save Time & Hassle
Your time and sanity are just as important as saving a bit of extra cash. Consider how much time it would take you to research multiple loans types from multiple lenders on your own. Why not outsource to someone who’ll do the majority of the hard work instead?
A mortgage broker will offer expert advice and support you throughout the entire application and pre-approval process, including:
– Speaking to the banks on your behalf
– Helping you apply for any government grants
– Doing all the paperwork for you
– Shedding light on options and loan features you might not even know about
– Answering any questions you might have
3. Access to Exclusive Non-Advertised Deals
The existing relationship a mortgage broker has built over time with the banks is extremely valuable when negotiating the best deal for you. If you go straight to the bank for a quote, you’re limiting yourself to a few select loans that may or may not suit your financial situation. Whereas speaking to a broker will unlock extra perks you’d otherwise miss out on.
4. Access to Expert Knowledge
Finally, mortgage brokers have a wealth of knowledge and experience at their fingertips. With so many different types of loans out there these days, it helps to talk to someone who secures loans for a living. They have access to helpful information you might otherwise not find on your own, which can make a huge difference to your mortgage in the long run.
But if you’re not yet eligible for a mortgage, don’t worry – your mortgage broker will help advise you on how to prepare your finances moving forward.
If you’re interested in buying a house, you can approach a lender for a pre-approval. A home loan pre-approval is an indication that a lender is likely to approve you for a home loan, for a fixed amount, based on your current financial situation. By offering a mortgage pre-approval letter from a lender, it assures you, the seller and the real estate agent that you have the ability to complete the purchase of any home that meets the lender’s guidelines.
Some of the main benefits of getting pre-approval before you start looking a property include:
– Know your budget when beginning your search
– Shows what you can afford to spend and what your monthly repayment will look like
– Puts you in the best possible position to make an offer when a property in your price range comes along
– Gives you more confidence when communicating with agents and negotiating with the seller
– Gives the seller more confidence in your offer by showing that you’re a serious buyer
– Makes it much faster to be fully approved after you find a home
One of the most important questions to ask yourself when thinking about buying property is whether to choose new or established. As a first home buyer, purchasing new means you could be eligible for no stamp duty (for homes under $430,000). (Please note: You could still be eligible for no stamp duty as a first home owner when buying established.)
Buying new also means that the home is eligible for the First Home Owners Grant (FHOG). The First Home Owners Grant (FHOG) WA is a one-off $10,000 payment available to eligible first home buyers to buy or build a new residential property. To qualify for the FHOG, some of the requirements are:
– Be an Australian citizen or permanent resident
– Never owned a residential property anywhere in Australia
– Not previously received a FHOG from any other State or Territory in Australia
– Be 18 years of age or older
– Occupy the home as your principal place of residence for a continuous period of at least 6 months (this must take place within 12 months of receiving the FHOG)
With supportive government programs in place like shared equity, now is the perfect time to take advantage. A great option for first home buyers, shared equity means you could get into your new home where you otherwise might not be able to. So what exactly is it?
A first of its kind initiative in Australia, shared equity can assist in reducing the home ownership costs by up to 30% for eligible applicants. When buying a home under shared ownership, the State Government acts as a silent partner in the transaction who pays part of the purchase price to help you into your home sooner. In turn, this reduces borrowing costs to make homeownership more affordable.
Some of the main benefits of shared equity include:
– Low deposit of $2,000 or 2% of the purchase price (whatever is greater) for first home buyers
– Deposit of $2,000 or 2% of the purchase price plus stamp duty and fees for non-first home buyers
– No savings history required
– No lenders mortgage insurance
– Can be used in conjunction with the FHOG
When choosing your perfect home, you need to think about your purchase carefully. Not only are you making a decision for your family right now, but you’re also making a long-term investment for your future. Therefore, some factors to consider are:
– Local amenities
– Schools within the catchment
– Infrastructure in the area
– Access to transport links
– Proximity to family and friends
– Commute to work
– City vs. suburb vs. rural
So before you even begin house or block hunting, you need to do your research. You can find out facts and statistics through real estate websites. For example, have a look at the Now Living Realty suburb reports to see the best suited suburb for you.
At Now Living Realty, we believe that everyone deserves to have a great experience when dealing with property – and that includes finance. Being part of WA’s largest building group, BGC, allows us to ensure that our customers needs are always kept top of mind. This then allows you to be comfortable when making your finance decisions.
Now Living Realty also works closely with The Loan Company*, one of Perth’s highly awarded mortgage brokers, who offer a range of mortgage options to suit your needs.
Contact Now Living Realty today and we’d be happy to point you in the right direction to get your finances sorted by one of our accredited finance professionals.