Buying your very first property is a big decision, and it's important to ensure that you are prepared for the financial commitment that comes along with securing a home loan.
Many first home buyers may feel overwhelmed when presented with the sheer variety of loan products available. With so many options and features to choose from, a qualified mortgage broker can be essential in helping you select the right product for your needs.
If you're looking to get your first home loan, here are a few tips to help make the process easier.
Know what you can afford
In order to get a home loan that's suitable for your requirements, it's vital to know how much you can afford to borrow. You'll need to consider your budget, and what kind of property you're aiming to purchase as this will have an impact on how much you need to borrow.
Loan repayments are another component which you need to factor into your budget. An experienced mortgage broker can help you work this out, and there are also online calculators available to help you anticipate the costs of your repayments.
The size of your home deposit will also affect your loan options, as the more you save towards your property, the less you'll need to borrow. Generally, it's advisable to aim to save 20 per cent of the purchase price.
Decide which features you need
There are many features available with home loans, from split rates to direct salary credit and loan portability.
Before committing to a loan, you need to consider which features you require. For example, if you are a disciplined saver, an offset account may be a good option as this will give you the ability to pay off interest with the extra savings you build up.
However, if unexpected costs arise in the future, you may gain peace of mind from knowing you have a redraw facility added to your loan as this will allow you to access extra payments you have made.
A mortgage broker can help structure your loan with the features you need, and provide knowledgeable assistance throughout the process of finding your first home loan.