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Buying a Home

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Looking to get back into the property market?

So, you’ve decided you’re ready to take the leap to get back into the property market by buying a home. Once you’ve made the decision, the first question our clients ask us is what’s next? We’re here to help guide you through and explain the process step by step.

At Crest Lending we turn a sometimes daunting task into an enjoyable one by helping you focus on what’s important and ultimately achieve your property goals.

What Do You Need To Do Before Buying Property?

There is no doubt that purchasing a home is an exciting time. But before you consider a house mortgage loan, you should first assess your financial situation to make sure you will qualify for a home loan. The following are important factors you need to take into account when you’re buying a home:

Save for a Deposit

It’s no secret that the bigger your deposit, the more you’ll be able to borrow. Generally speaking, banks and lenders will lend you 80% of the house mortgage loan if you have the remaining 20% as your deposit. It is possible to take out a home loan with as little as a 5% deposit if you meet the First Home Loan Deposit Scheme criteria or other criteria which may incur additional fees.

Check your house buying eligibility

Check that you’re eligible for a home loan by contacting our experienced mortgage broker to discuss your borrowing power based on your debts and financial situation. Checking your eligibility will allow you to plan what and where you can buy realistically. You can also check out our borrowing power calculator to learn where you stand.

Research different finance options

After checking your eligibility, you should educate yourself about the different finance options available to you. Various types of mortgage loans work for different people for different reasons. Consider variable and fixed-rate loans, or a combination of both, interest-only loans and property bridging loans. Finding an option that suits your needs is important when looking for a new home. Compare and contrast different loans to ensure you get a competitive rate with the right features.

Consolidate debt to boost your borrowing power

Having personal debts does not mean you are not eligible for a loan. However, it will affect your borrowing power, so you may need to consolidate your debt to boost your borrowing power. Create a budget to pay off any large or unsecured debts you may have, especially those with high interest. Consider consolidating your credit cards or cancelling them if you are in a position to, and deactivate any buy now pay later apps that contribute to your debt.

7 Steps to Buying a House

Now that you’ve established you can borrow enough to buy a house you may be wondering what the next steps involve. Many people feel comfortable working through the following seven steps themselves. However, it’s important to note that you should always seek professional help before signing a loan, as it’s a legally binding contract.

1. Assess Your Financial Situation

As we’ve discussed, get an idea of your financial situation and what you can do to increase your borrowing power

2. Research The Property Market

You can buy many different types of property, but it all begins with the land. Ideally, you want to purchase a home that fits your lifestyle. Realistically consider your lifestyle needs, and research suburbs based on what’s important to you to find a balance that will allow you to live life and own property.

3. Decide on Your Ideal Property Type

Once you know what areas you want to buy in, it’s time to decide on a property type. During this step, reflect on why you want to buy. Do you want to grow your family in a new home, or are you looking to renovate an older house? You might like apartment living in the city, or are you looking for a turnkey house in the suburbs? Consider the must-haves and nice-to-haves. Focusing on the must-haves will allow you to prioritise the most important factors when buying a home.

4. Find A Home Loan

Once you decide on the areas and the type of house you want, you will understand how much it will cost. Now it’s time to find a home loan, and contacting an experienced mortgage broker is a great place to start. Our Crest mortgage brokers will find you a home loan with the most competitive rate and appropriate features to suit you and your financial situation. You may even be able to get a pre-approval which will give you the confidence to go out and purchase a home.

5. Search For Your Future Home

Arguably the most fun step, it’s time to search for your future home. Go to as many inspections as possible and network with real estate agents. Stick to your budget and do your best to stay focused on what’s important to you. Consider doing a pre-purchase building and pest inspection so you’re aware of the property’s condition.

6. Negotiating To Buy

Once you’ve found your dream home, you’ll need to negotiate to buy. Whether the house will go to auction or be sold privately, you need to be prepared. If buying at auction, expect to pay an immediate deposit with no cooling-off period. If buying privately, the Contract Of Sale will include the deposit amount and when you need to pay it.

7. Settle On Your New Home

If you win at auction or your offer is accepted in a private treaty sale, then the home is yours. The settlement date is when the property title is transferred into your name – this is the date your mortgage begins. You will be given a Contract Of Sale which sets out the settlement date and when you must pay the total purchase price. There are additional costs associated with the settlement, so make sure you have enough funds for settlement, conveyancing fees, and stamp duty. Once your settlement is finalised, you will get the keys to your house, and you can move in whenever you want.

What to know when buying an apartment

Apartments are a fantastic option if you want to live closer to the city or near the beach. Apartments are usually much more affordable than homes; however, houses historically see more capital growth. If you’re considering buying an apartment, look behind the price tag before making an offer.

Strata fees and apartments go hand in hand. Strata is an annual fee that members of a shared building pay to cover maintenance costs in shared areas. These fees are different depending on the building complex. Apartments with attractive facilities such as pools and gyms generally charge higher strata fees. Contact Crest Lending to discuss the costs associated with buying an apartment compared to houses.

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Short Term Property and Bridging Finance

Short-term property finance is used for a specific short-term purpose, and this type of loan is secured against assets. A bridging loan is an example of short-term property finance and allows you to sell your existing home first when you’re looking to purchase a new home or find temporary accommodation while you search for your next home.

There are two types of bridging loans:

Closed Bridging Loans

Used if you have a Contract Of Sale on your existing home and know the date when your home will be settled with funds received.

Open Bridging Home Loans

An open bridging loan can be arranged for up to 12 months to provide you with a loan if your existing home has not yet been sold.

For more property buying information check out our Home Buyer Essentials Guide

Gold Coast Home Finance Brokers

Crest Lending offers a range of home loan options from a number of lenders, which means we have access to an option that will suit your individual needs. Whether you’re buying a new home, refinancing, building a home or you’re a first home buyer. We love nothing more than helping our clients in buying a home that allows them to achieve their property goals.

Contact Crest Lending and our team of mortgage brokers to discuss your home finance options and help get you on the way to purchasing a home.