There are many pitfalls for unwary homebuyers. However, there are a few simple precautions that you can take to make the experience of buying a property an enjoyable and profitable one.
1. Get into the ‘saving’ habit.
A savings record proves you can manage your spending, with proven lower living expenses increasing your ability to obtain a loan. The deposit you save also increases options available. How much deposit you need is an individual discussion – call us for that!
2. Control existing debt.
Be responsible with existing debts. How you manage your credit cards, car loans or personal loans, determines your credit profile in buying a house. Making repayments on time is important, having a debt default is a major hurdle to overcome. Speak to your broker about if it is best to pay out existing debt or not, there is a balance between needing deposit and needing free monthly cash flow, this will vary person to person, you should seek personal advice.
3. Understand property costs.
Learn the actual cost of buying and owning a property. There are significant purchase costs, then ongoing fixed expenses such as council and water rates, and variable expenses like utilities and maintenance. Budgeting the loan repayment is only a part of the equation.
4. Know your limits.
Only go house hunting after you know how much you can borrow and what purchase price you can afford. There is no point in setting your heart on a house that is out of your price range.
5. Compare lenders, and loan products.
There are thousands of loan products in the marketplace, each has its place and purpose. You deserve the loan product most appropriate to your personal requirements, one that suits your budget and your circumstances.
The above may sound daunting, but it need not be. Develop your trusted team and open the discussions. If you have a ‘money talk’ phobia, it is time to get over it!
Integrity Finance Australia has been serving the community since 2006. If you have any questions on the issues raised in this article or borrowing capacity or your home loan in general, then please email support@ifafinance.com.au , or call us on 03 9511 8883.