First home buyers: Securing a home loan isn’t as impossible as you think

While the very thought of securing a home loan leaves many feeling intimidated and more than a little overwhelmed, the process isn’t as difficult as we’re led to believe. Buying your first home is one of life’s most important financial decisions. With a little guidance, that initial step of applying for a home loan doesn’t need to be an impossible task.

We have broken down the process and compiled a list of things you need to know when thinking about securing a home loan! Check it out.

BASIC BOOKKEEPING

Ensuring your finances are in order is essential before seeking to secure funding from the bank. Clearing any existing debts such as car loans, personal loans and outstanding credit card debt is the easiest way to separate your savings from your expenditures and demonstrate your ability to budget efficiently and effectively to the lender.

CREDIT HISTORY

What’s most important to any financial institution is that you’re able to pay your bills consistently and on time. Remembering to account for key costs including land rates, home and contents insurance and electricity is critical. The most attractive and successful candidate for a lender has minimised their debt and is able to organise their expenses.

HOW MUCH DO YOU NEED TO BORROW?

Part of the process of buying your first home is gaining an understanding of your borrowing capacity and keeping your goals realistic. A mortgage calculator is a useful tool for assessing your best deposit amount based on what you can afford in monthly repayments and interests. With proper consideration of your income and expenses, it is possible to handle a mortgage stress-free.

SAVING MATTERS THE MOST

When it comes to securing a first home loan, not only does a larger deposit mean less money borrowed from the bank, it also allows you to save more in interest. By striving for a deposit of at least 20% you avoid being charged Lender’s Mortgage Insurance and, by extension, the higher interest rate which often attaches here to your loan. First home buyers may also be eligible to receive a grant from their State Revenue Office under the Australian Government’s First Home Owner Scheme.  

SEEKING ADVICE

Make sure you are fully informed before making a commitment. Professionals can tailor the best deals and advice relevant to your needs to maximise your eligibility to secure a home loan. Many property advisers and financial institutions also offer initial consultations.

Are you a first home buyer thinking of building your own home? With a little planning and the right advice, the task of acquiring a home loan and building doesn’t have to be stressful! Book a call with our team of experts or call 1800 184 284 to get started today!

If you’re having trouble financing, download our FREE guide to get a comprehensive overview of what you should expect and prepare for!

Kaylah Chesson

Kaylah is completing her final year of a Bachelor of Arts / Bachelor of Laws degree at Deakin University. Her particular areas of interest include property and land law, home design and the creative arts.

About

iBuildNew is the market leading aggregator dedicated to residential home construction and land development. As an independent platform, iBuildNew helps Australians identify and compare new home designs, house and land packages and land estates. It’s the smart way home buyers, who are considering a new build, can find the ideal options to match their individual needs. Home building is a big decision, we make sure you get it right.

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