So, you’ve saved your deposit. What’s next?
Congratulations! You’ve completed the hardest part of buying stage. You’ve made sacrifices and saved your bickies. Now it’s time to get real. Let’s turn that hard-earned cash into an investment in your future.
While many lenders in Australia require a 20% deposit of the property’s price to avoid paying mortgage insurance, you can still apply for a loan with lower amount. But if you haven’t saved 20% and want to avoid paying mortgage insurance, there are other options like the First Home Loan Deposit Scheme.
After you’ve got all of this sorted, what’s next? The steps you take now can save you a tonne of money.
One. Find a good mortgage broker.
This step is listed first for very good reason. They really can save you a bundle. Why people still apply directly to a bank is completely beyond me. Before you even start looking at properties, this is the first step you should take. Your mortgage broker can help you secure a pre-approval, so you can have a realistic idea about how much you can borrow. Without knowing exactly how much you can borrow, you may land into a world of disappointment when you find a dream home you can’t afford. Wah.
Two. Find a qualified Buyer’s Agent.
If you’re a first home buyer, don’t be fooled. A buyer’s agent isn’t something for the fancy folk, they’re actually even more useful for first home buyers. When you don’t have buying experience, it’s important to have someone guide you through the process – it could just save you a tonne of money.
Buyer’s Agents have a wealth of knowledge of market trends and the really clever ones use data to make sure you’re making the right purchase decision. When it comes to negotiation, you’ll really see your savings stack up. Knowledge equals stronger negotiating powers – especially when it comes to sales agents using sneaky sales tactics.
Of course, money isn’t the only thing you’ll save – you’ll save stacks of time too. They’ll do all the leg work and present you with a bunch of dream home options. You can of course participate in this process, but there are many hidden gems you may not find – like off market properties. It pays to be in the know.
Three. Research locations
Before you go to a buyer’s agent, it’s a good idea to make a list of areas you like and really imagine your life there. Be practical with both your day to day activities and the price of the properties in the area – there’s nothing worse than overextending your budget and then regretting every day you live in the home of your dreams – or nightmares?
Four. Make a list of non-negotiables.
These are the things you absolutely must have – like th number of bedrooms, a pool, close distance to shops etc. These things will keep you on track – even if you fall in love with one aspect or feature of a home.
And don’t fall victim to analysis paralysis. When you look at so many properties, you can get overwhelmed with choice. You need to be decisive and refer back to your non-negotiables. Only properties that tick all boxes should be on your shortlist.
Five. Get legal advice.
Buying a property involves a lot of complex paperwork. And while you can do it yourself with DIY conveyancing kits available online, it really pays to seek out a good conveyancing solicitor. If you’re looking at buying land, you’ll definitely need to seek help of an expert conveyancing lawyer. There are a number of issues that affect the use of the land, so you’ll need to do your homework to make sure your intended use of the land is actually possible. For example, you’ll need to make sure the council zoning is permitted for residential use.
Six. Look into building and pest inspectors.
This is not something you want to skip, or you could end up buying a nasty surprise. We don’t need to labour on this one, just do it!
Seven. Work with your team.
Your team is everyone involved buying the property – and not just your partner. Your buyer’s agent, mortgage broker and your conveyancer. Make sure everyone’s on the same page, so you can get into your dream home faster and without any hiccups.
There’s a lot more to know, but this is a good start. You can always refer back to number 2 and save yourself a lot of time.