First Home Buyers

• know your spending habits
• set a budget
• pay yourself first, aiming for 10% of your after tax income each pay day.
• your contribution, generally between 5% and 20%, towards the property you wish to purchase.
• for deposits under 20% Lenders Mortgage Insurance is required, which protects the lender, not the borrower
• lenders will want to see a history of regular deposits into a savings account for a minimum of 3 months. Try out our savings calculator here.

Family guarantee allows you to buy a home sooner by using the equity in a family member’s home as additional security on your home loan. There is a risk for the guarantor and lenders will require guarantors seek independent financial and legal advice. If you are unable to pay your loan your guarantor will become liable. Another option is a non-repayable financial gift.

The benefits of both these options are that if the loan to value ratio 80% or less, Lenders Mortgage Insurance is not required.

In addition to the deposit, you will need to cover other costs associated with buying a property and obtaining a home loan:

• home loan establishment fee
• ongoing monthly fee or annual home loan package fee
• property valuation, building and pest inspections
• government fees such as stamp duty and registration fees
• conveyancing fees, including rate adjustments
• building and contents insurance
• moving costs
• owners corporation fees

• be realistic about how much you plan to spend on your first home.
• use our loan calculators to gain an idea of your loan affordability and likely monthly repayments.
• once you feel comfortable with a particular loan amount, adjust the interest rate up by 2% to make sure you would still be able to repay the loan if interest rates increase.
• review your budget and take into account future plans such as having children.

• pre-approval is when your lender approves a loan limit, based on your current situation, before you purchase a home.
• pre-approval is looked upon favourably by vendors and is vital if you intend purchasing at auction.
• to determine pre-approval, lenders look at your financial position, income, expenditure, savings, employment and credit history.
• conditional pre-approval generally lasts for 3 months and it is up to you to let the lender know if your circumstances change, such as starting a new job.

No matter what kind of home you’re looking for, there are some key features to consider. There are large townhouses or apartments and small family homes, so looking for what you want in a home is as important as the type of building.

• where will you spend most of your time? Should you aim for a large kitchen, living area or outside entertaining area? Or all three?
• how many bedrooms do you need? Do you have lots of visitors?
• is one bathroom enough or do you need more?
• buy, build or renovate?

These are just some basic questions. Each home has its advantages and disadvantages and no two buyers have the same wants or needs. The best way to evaluate which home is right for you is to consider what you must have and what you can live without.

There are a number of resources you can use to find a home, including:

• newspapers and real estate publications - check the houses for sale sections in daily newspapers or look out for real estate magazines that focus on your preferred area.
• the Internet - visit real estate websites such as www.realestate.com.au or www.domain.com.au.
• word of mouth - ask friends and family.
• real estate agents - talk with real estate agents in the area; when choosing a real estate agent, make sure that they have Real Estate Institute of Australia (REIA) accreditation.
• don’t buy on impulse, consider all the facts carefully. Return and take a more critical look at the property. Visit on different days and times, chat with locals and look beyond the surface.

Closely check the:

• Exterior
• Roofing
• Foundations
• Driveway
• Paths
• Landscaping
• Fences
• Garage / carport
• Windows
• Floors
• Walls
• Appliances
• Lighting fixtures
• Storage areas
• Ventilation
• Sunlight
• Privacy
• Views

If you think you have found the property for you it may be worthwhile to pay for a professional inspection to check potential problem areas.

Variable interest rates, comparison rates, mortgage offset, stamp duty, redraw – what do they all mean? It can be overwhelming. Speak to a Geelong Bank loans specialist who will not only guide you through the process and help select the home loan right for you, they will ensure you have a clear understanding of your obligations.

Once you have signed a contract to purchase your home, it’s time to think about protecting your assets with insurance.

Our Lending Solution includes obligation-free quotes on any home and contents insurance with our insurance partnership with very reputable and experienced mainstream insurance providers.

Achieving the dream of home ownership is one of the most exciting times in your life. However, it also comes with a big challenge – the time it takes to save a substantial deposit that lenders often require (typically 20% of the home’s purchase price). If you do not have a substantial deposit saved, your lender may be prepared to provide you a home loan with a smaller deposit (as little as 5%), by taking out Lenders Mortgage Insurance (LMI).

Lenders Mortgage Insurance (LMI) is an insurance policy that your lender takes out to protect itself against the risk that you (the borrower) default on your loan repayments and your lender is unable to recover the full outstanding loan amount.

Lenders Mortgage Insurance is arranged by your lender and the premium is a one-off cost your lender pays to us (the insurer) upon settlement of your property purchase. This cost is passed on to you (the borrower) by your lender, as a fee.