I want to buy my first home, where do I start?

First Home Buyer, looking for some tips to get you going in the right direction? Here are a few things to know that we talk to lots of our first home buyers about, to get them on the right track!
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1. Speak with your broker... there are a few little costs, that you don't want to find are surprises, to allow for in your deposit.... are you going to need to pay Lenders Mortgage Insurance? What about conveyancing costs? Not sure what to allow for these (or how to avoid Lenders Mortgage Insurance if possible)? We know, speak to us.
2. Run a tight ship... more and more lenders now assume that your living costs, will continue and are not negotiable... for example, you might be hitting the town a little more at the moment, with the knowledge that when you buy, you will tighten your belt, and run a more efficient budget... but the banks won't see it like that.... so, tighten the belt now, and show that you can stick to a realistic budget over a 2-3 month period, it will make the application for finance run more smoothly, and the bank will likely ask less questions!
3. Much like point 2, don't lean on your credit card too much.... credit cards are unsecured finance, and while it is logical that you might use and pay out the balance in full each month to accrue points or similar, a credit card that has a balance that is increasing each month, indicates you may be spending more than you are making... Remember, that sometimes, you might use your credit card to pay off say whitegoods over a period of time, but, for incidentals, probably not a great idea to carry forward over multiple months (not to mention it will save you a packet in interest!)
4. Got any other lines of credit, unused credit cards, personal loans, and even AfterPay? An important lesson to learn, is that the banks will assume that you can max out these facilities any time, even if you haven't used them in a long time, and will assume the maximum due payment... AfterPay repayments, given they are over a short period of time, often really hurt borrowing capacity! So, if you don't need it, get rid of it... it will improve your credit score too!
5. Remember, that for every $700 of possible unsecured credit repayments each month, this will wipe out around $100,000 in borrowing capacity for property... in real terms, a credit card with a $15,000 limit, will wipe out $150,000 in borrowing capacity for that new property... if you don't need it, get rid of it!

Got more questions? Feel free to book a meeting and let's chat!

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