Your First Home Buyer Checklist
If you’re new to the home buying process then it all might seem a bit overwhelming. Luckily, Northwick Funding has a First Home Buyer Checklist that can make the process as easy as possible and help you stay organised along the way.
Set a budget
Before you do anything else, set a budget. Your budget needs to take your expenses into consideration, so use a budget planner calculator to estimate your monthly spend and see what you can comfortably repay each month. If you wait until after you start searching for houses to set a budget then you’ll be more likely to push that budget higher and spend more than you can realistically afford.
Save for a deposit
Now that you know what you can spend, you’ll also have an idea of what you’ll need to save. Generally you’ll want a deposit of 20% of the new home’s value. Not having this doesn’t mean you can’t purchase a property, it just means you’ll likely need Lenders Mortgage Insurance (LMI). Our Mortgage Broker Paul can talk you through whether this is a good option for your circumstances.
Research properties and suburbs
While you save for a deposit, you can start looking at where you want to live. How you approach this is all dependent on what’s important to you. Do you want a shorter commute to work each day? Is there an area with a good school you want your children to go to? Are you close enough to family, or far enough away if that’s what you want instead? Finding that balance between what you can afford and where you want to live can be tricky, but it’s all about figuring out what your non-negotiables are and making sure your house meets your needs.
Chat to a mortgage broker
This is the time where having a mortgage broker can save you a lot of time, effort and money. Instead of settling on the first lender you find, talking to a mortgage broker gives you access to dozens of lenders and loans. Your broker will first chat to you about your goals and financial situation, offering you advice and guidance as you move through the home buying process.
Get pre-approval
Once you’ve decided on a lender, your mortgage broker will help you apply for pre-approval. Pre-approval, also known as conditional approval, gives you a good idea of what a bank will lend you. It’s not a guarantee of financing, but it’s a stage to help you better understand your borrowing capacity and any barriers, and also signifies to sellers that you have the capacity to buy their property.
Go to open homes
Now that you have pre-approval, you can start really househunting. You’re viewed as a much more competitive buyer if you come to open homes with pre-approval, so start taking a look at properties you like.
Put in an offer
Found a property you love in your budget? Great! Put in your offer and prepare for any negotiations with the seller’s real estate agent. Once it’s accepted you can move on to the final stages.
Apply for the First Home Owners Grant
As a first home buyer, you’ll likely be eligible for the First Home Owner Grant. In Queensland this grant gives first home buyers $15,000 to $30,000. Your broker can help you apply for this.
Bring in the professionals
Here is when you’ll want to engage with outside professionals. Your broker can help you arrange a conveyancer or solicitor to formalise the legalities of the home buying process. You’ll also want a building and pest inspection to make the property is in good shape. If something comes up in the inspections that requires attention, you can use it to try and re-negotiate the price based on the cost to fix it.
Get unconditional approval
Unconditional approval means your lender has completed all checks needed to offer you the money. While pre-approval is contingent on certain factors that need to be met, unconditional approval is the lender agreeing that you have met those factors. Your mortgage broker will do all of the paperwork for this and run you through every detail of the process.
Wait for settlement
As you wait for settlement, you’ll want to use this time to arrange your home insurance, organise your utilities and make arrangements for moving. If you’re planning on making any renovations as soon as you move, you can organise these now too. Remember, it’s a lot easier to paint or replace carpet before your furniture arrives.
Move in!
You’re ready to move into your new place! With your utilities organised and moving arrangements made already, it will make your moving experience a lot easier. Once you move you’ll also want to redirect your mail to your new address.
Buying your first home is an enormous achievement so all that’s left for you to do is celebrate it!