What to expect when applying for a first home buyer loan?

Any general questions you might have in regards to loans and finance.
Ollie
Posts: 3
Joined: Thu Jan 24, 2019 4:00 pm

What to expect when applying for a first home buyer loan?

Postby Ollie » Thu Jan 24, 2019 4:02 pm

We are a couple in our early 30s with a baby on the way. My wife and I are looking to buy our first home. What can we expect when applying for a first home buyer loan? Any general advice is welcome.

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7316
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: What to expect when applying for a first home buyer loan?

Postby Otto Dargan » Thu Jan 24, 2019 4:58 pm

Hello Ollie. Welcome to the forums.

Congratulations on the baby. Before applying for a first home buyer loan, there are 6 essential questions you need to answer:

  • 1. How much deposit do I need? You need at least 5-10% of the property as a deposit. Most banks require that the deposit is in the form of genuine savings.
  • 2. How much does a home loan cost? On top of the interest rate, getting a home loan also comes with additional costs to complete the purchase of the property including stamp duty, transfer fee, registration fees, conveyancing fees, and Lenders Mortgage Insurance (LMI) etc.
  • 3. Are you eligible for a first home owners grant (FHOG)?
    Some states offer grants or stamp duty concessions to first home buyers. Visit your relevant state revenue office website to find out the eligibility criteria and how much the grant is.
  • 4. How much is LMI? If your loan amount is more than 80% of the purchase price, you’ll have to pay LMI as a one-off fee. You can calculate the LMI premium you'll pay based on how much you are borrowing.
  • 5. What application documents do I need to provide?
    Here’s a list of documents needed for all types of loans:
    A.Short Application Form (provided by your broker)
    B.Three forms of identification such as a driver license, passport and Medicare card.

    In addition, PAYG Applicants also need to provide the following documents:
    A.Your two most recent payslips
    (optional) A letter from your employer confirming your income.
    B.(optional) Your last year’s group certificate.

    If you can’t provide the above documents or they are not up-to-date, there are low doc options available.
  • 6. How can a mortgage broker help me?
    Mortgage brokers can objectively assess your needs and guide you through the entire home loan application process all the way to settlement.

    Their services are normally free and they only get paid commission from the bank when they actually approve your mortgage.
    It's in their interest to find you the home loan solution that meets your needs and will help you achieve your long-term goals.

Speak to one of our mortgage brokers directly by calling us on 1300 889 743 or enquire online

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Ollie
Posts: 3
Joined: Thu Jan 24, 2019 4:00 pm

Re: What to expect when applying for a first home buyer loan?

Postby Ollie » Thu Jan 24, 2019 5:18 pm

We are looking at houses priced around $600k in Liverpool, NSW. We will be able to pay a 10% deposit for the house. Apart from the interest rate, how much additional costs are we expected to incur?

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7316
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: What to expect when applying for a first home buyer loan?

Postby Otto Dargan » Thu Jan 24, 2019 7:13 pm

Hi Ollie,

When you buy a property, you can expect to spend up to 3-5% of the property value on stamp duty and other government fees, legal and conveyancing costs, LMI and home loan set up costs (depending on the lender and the home loan product).

For a $600,000 home loan, there may be up to $30,000 worth of extra costs involved in order to complete the purchase.

The first home owners grant (FHOG) can help you to cover these costs so we recommend that you contact the NSW OSR to find out if you're eligible.

Let us guide you through the process of getting your first home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Ollie
Posts: 3
Joined: Thu Jan 24, 2019 4:00 pm

Re: What to expect when applying for a first home buyer loan?

Postby Ollie » Thu Jan 24, 2019 8:10 pm

That sounds like a plan. One more thing, how much is LMI exactly?

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7316
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: What to expect when applying for a first home buyer loan?

Postby Otto Dargan » Thu Jan 24, 2019 8:14 pm

Hi Ollie,

Please check our LMI calculator and compare LMI premiums from six of Australia’s largest banks.

Our mortgage brokers are expert in first home buyer loans and can help you get approved for discounted interest rates.

Please call us on 1300 889 743 or enquire online to discuss your situation with a mortgage broker.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


Return to “Home Loan Forum”

Who is online

Users browsing this forum: No registered users and 12 guests