If you’re consider getting into the market to become a first time home owner, there are many important considerations you will need to make. Among the most crucial of those is determining how much of a deposit you will need to build your first home.
Getting to a comfortable level, enough money for a home deposit is one of the many major accomplishments for first-home buyers. However, we’re never really sure what we should be aiming for. Through this article, we will provide you with some much needed clarification on this concern.
How Much Of A Deposit Will I Need?
While it will indeed vary from bank to bank, lender to lender, some banks will be prepared to provide you with a loan that sits around the 20% mark, while others will be less generous with as little as 5%
The More You Save
The more you are able to save the better, of coarse. Lenders will see this as appealing and attractive, and become more enticed to offer you an increased amount.
It’s well worth waiting an extra number of months and watching your amount grow.
If you aren’t able to save 20% of your mortgage, you may have to pay mortgage insurance. However, saving for a few more months may be worthwhile to avoid paying & have more money for the actual price of your dream home.
It’s vitally important to factor in these increases when you’re making decisions when and how much you would like to borrow.
What Other Costs Are Being Charged?
Largely depending on which state you’re building in, first-home buyer concessions can help cut down on a number of the additional costs typically associated with buying a home.
If you’re wanting to build in Victoria, there’s no stamp duty payable on any property up to $600,000.
For homes worth $750,000 and beyond, there is an expectation to pay duties around 5% of the total purchase price ($40,000 on a $750,000 home). With this knowledge, you can apply for that extra cost to be added onto your loan – meaning the amount will slightly increase.
Everything will add up, there a number of smaller fees which may fall under the guard. For example, conveyance, title transfers and alike may mean an additional couple thousand dollars you will require.
Construction Home Loan Versus Regular Home Loan
In short, a construction home loan can provide one of two options – a fixed or variable option. Again, this depends on the lender and the loan product. It’s a concern of doing your background investigation on which bank you go with.
Generally speaking, the majority of lenders should offer you the same or similar interest rates for either loan. The key difference between the two is that money drawn down in stages as it is needed.
How Can iBuildNew Work
Here at iBuildNew, we can provide you with all the information you will need under any and all circumstance! Whether you’re a first home builder, or seeking to purchase an additional property, we have you covered.
For further information regarding this or any other issue, don’t hesitate to speak with one of our home building professionals on 1800 184 284. You can also book a call online.
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