You’re about to embark on the biggest financial milestone and committment in your life, well good on you…… So where do you start?
Committing to a 30 year home loan is something you won’t want to take lightly, so it is important to do your research..and then do more research.
Familiarise yourself with the mortgage process, the types of home loans available, what to look for in a mortgage broker and more importantly what are your rights and obligations as a borrower.
To help you get started, here is as step by step process to get you on the right track.
- Take time to do a budget. By doing this you will have a better picture of your financial position and you will be able to set your financial goals.
Do you need a 2 bedroom unit or a 4 bedroom, double garage home on a half an acre block? What are your housing needs – try to be a little more long sited in your determination because selling and buying real estate is not only stressful but also costly. Research the areas you are interested in and the prices of the properties in that area.
Now it is time to find yourself a professional mortgage broker! Your broker will prepare your home loan application for pre-approval or conditional approval.
- Get your pen and note pad ready, comfortable walking shoes and start house-hunting. You can always narrow down the list by checking newspapers and the real estate websites.
At this point of time it may be advantageous to look into the services of a solicitor or conveyancer to take care of the legal side of things.
THERE ARE 2 WAYS IN WHICH YOU CAN PURCHASE YOUR HOME
A private treaty is a purchase made when you make an offer to a real estate agent. Once your offer is accepted – and this may involve a lengthy negotiating period – you will need to provide a holding deposit.
The real estate agent will prepare a ‘Contract of Sale’ which will need to be provided to your mortgage broker and solicitor/conveyancer.
Your mortgage broker will start the ball rolling for your home loan application to reach unconditional or full approval.
Arrange a building and pest inspection and if necessary a strata inspection for peace of mind.
Is your dream home going under the hammer at auction? Here is what to do. Arrange for a building and pest report and if required a strata inspection. Obtain a Contract of Sale from the real estate agent and make sure your mortgage broker, solicitor/conveyancer receive it.
Your broker will continue to work on your home loan application to reach unconditional or full approval.
If you are successful you will be required to pay a deposit which depending on which state in Australia could be around 10%.
Once you have completed the above stages for your private treaty or auction purchase, the following stages will occur:
Contracts will exchange and a deposit will need to be paid. You can pay the deposit in cash or with a ‘Deposit Bond’. It is important to note that once contracts have exchanged you are legally bound to the purchase and if you pull out of it you may be liable for the whole deposit of the purchase price.
You can instruct your solicitor/conveyancer to make the necessary enquiries, searches and prepare mortgage documents for settlement.
You will receive mortgage documents and a letter of offer from your lender. Read them carefully to ensure all details are correct, sign them and return them to your lender.
1. Insure your home from the day of settlement.
2. Carry out a final inspection on the property on or just prior to settlement.
3. Your solicitor/conveyancer will inform you of the exact amount you are required to contribute to complete settlement.
4. Buy a bigger key-ring and collect your new house keys from your real estate agent.
You’ve done it! Wasn’t that hard was it? Now you can have fun and organise a house warming party with a bunch of friends to help you celebrate the purchase of your new home.