Tip #1 – Understand what you can afford before you start looking for a home
There are 2 elements to this:
1. Understand what your borrowing capacity is
By sitting down with an experienced mortgage broker, you can determine how much you’ll be able to borrow. This is a crucial step, as it will help you discover the price range you can afford.
2. Understand what your cashflow looks like
If you know what you can afford to spend on your mortgage, you’ll ensure it won’t impact your lifestyle. If you currently pay rent, check how much it costs you. How much extra could you afford to pay on a weekly, fortnightly, or monthly basis, when you consider your other costs?
To easily interpret your cashflow, download our free budget planner and spending tracker worksheet.
Tip #2 – Understand your deposit options
There are lots of ways to raise your deposit.
1. Save money
It may sound obvious, but saving money truly is one of the best ways you can increase your deposit! It also shows the bank that you have the ability to save and manage your money well.
2. Family support
To help you raise your deposit, your family could:
- Gift you money
- Use the family guarantee scheme
- Leverage equity in property they own
For more in-depth information, check out our short video.
3. Government grants
There’s a strong chance you’re eligible for the First Home Guarantee Scheme, which can help you buy your first home with just a 5% deposit. The eligibility criteria were recently expanded. Learn more here.
If you’re building your home, you could also be eligible for even more grants. Chat to our friendly team to understand what may be available to you!
Tip #3 – Understand your purchase costs
Don’t be caught off-guard by unexpected costs when you buy your first home! These costs include stamp duty, Lenders Mortgage Insurance, conveyancer fees etc. We usually advise clients to allow for about 5.5% of the purchase price in purchase costs.
Tip #4 – Manage and monitor your living expenses
If you want to buy your first home, expect the banks to be hot on how much you spend day to day. Typically, they’ll check between 3-6 months of your spending history.
Our advice is to try to minimise spending during this period before you put in your loan application, so you can maximise your borrowing capacity.
Tip #5 – Get a fantastic mortgage broker
If you’re feeling overwhelmed, remember that you aren’t alone. A fantastic mortgage broker will take the time to understand your goals and circumstances to help you find the best lender and options for you.
At Rise High, we’ve helped thousands of Australians into homeownership! With our team in your pocket, you can rest easy knowing that your priorities are our priorities. But the best part? Our services come at no cost to you! If you’d like to chat more about how we can help you, book in a free First Home Buyer consultation. We’d love to support you!
