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First Home Buyer FAQ

Owning your home is a dream of many Australians so to assist you in making that a reality we have compiled a first home buyer FAQ to help you make an informed choice. People have many questions about buying a home and this first time buyer FAQ will help you manage the process and expectations of being a first home buyer. If you are unsure about anything in our first home buyer FAQ please talk to us, our home loans Gold Coast team are friendly experts ready to help you reach your goals.

Budget and savings

One of the goals of our first time buyer FAQ is to help you understand how your budget and savings will affect your buying in regards to your first home buyer mortgage.

How big should my budget be?

That will depend on your individual goals and desires as well as the ability to stay disciplined and save. Tracking your spending habits and setting financial goals will help you save money which will all play a big part in purchasing your first home.

How much of my savings will I need to spend on a deposit?

Typically, a first-time home buyer will need to spend 5-20% of the purchase price on a deposit. The type of home loan and lender also play a big factor in the amount of deposit required but as a general rule if you can save 10% of the property value this is ideal.

Loans and borrowing money

This section of our first home buyer FAQ explains some of the details behind various loans and borrowing money.

How much can I borrow?

This will be determined by your unique financial situation and includes your income, assets, credit history and existing liabilities. Lenders differ in the criteria they use to set your borrowing limit.

What types of loan rates are available?

Fixed or variable rate home loans are available to the first-time home buyer. Fixed loans set the interest of the loan over a period and offer protection against an increase in rates. Variable rate loans change depending on market conditions and may result in lower interest rates.

What sort of loans are available?

We offer a basic home loan or a home loan package. Our basic home loan is great for a single home loan and is simple to understand. Our home loan package bundles various accounts, credit cards insurance into a package to create savings and cheaper interest rates.

When do you apply for a home loan and what is the process of buying a house?

Start looking for a home loan after determining your budget and calculating how much you can borrow. Research properties that are interesting to you and learn about the market. Start making offers and once it is accepted, do your legal due diligence. If you’re unsure, get in touch with our team and we can help you navigate the process.

How much does it all cost?

The cost of the loan and interest rates will change from lender to lender. As a leading Gold Coast based mortgage broker, we will help you assess your choices and work hard to save you money.

Other costs and grants

What other costs are connected to buying a home?

The largest cost will be the price of the property. Other costs include but are not limited to the following:

  • Property Valuations
  • Mortgage Registration Fee
  • Loan Application Fee
  • Lenders Mortgage Insurance (if applicable)
  • Legal Fees
  • Moving expenses
  • Removalist fees
  • Stamp duty

What is stamp duty?

It is a charge related to buying land or property applied by the state governments. It will need to be paid in advance and should be a part of your budget plan but in some cases it wont be payable for first home buyers. The amount required will be different from state to state but is based on:

  • the property being either a primary residence or investment property
  • the buying vacant land, a new home, or establishing a home on the property
  • whether you are a first-time home buyer

What is the first home owner grant?

The Federal Government funds this scheme and each state or territory manages it. The amounts available differ from state to state and the rules may change every 6 to 12 months but currently  start at $7,000 and go up to $26,000. You need to be applying for the grant for the first time and be a first-time residential property owner. Everyone that is eligible should apply since it is free money that can reduce the cost of your home.

How is interest calculated?

Your lender and loan contract will determine this. Usually, the interest cost is calculated daily on the loans outstanding balance.

Looking for more answers?

Our mortgage broker Gold Coast team are excellent at helping Australians buy the home they have always wanted. We hope our first home buyer FAQ has helped and if you have further questions, get in touch with the team at Oak Tree Finances today. If you are thinking about, or are ready to commit to, purchasing a new home call us on 0404 403 066 or contact us online. 

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