When buying your first Australian home, you’ll probably need to borrow a large percentage of the purchase price. Banks know that first time homebuyers need help, especially if they’ve been renting and not living for free with family or friends. Renting makes it harder to save a nest egg for a large down payment, so some banks will offer special deals for first time homebuyers.
There are some typical things you can do to make sure you qualify for a home loan as a first time homebuyer. Make sure that you remain actively employed. If you unexpectedly get laid off or lose your job, you will need to find new employment and be with the company for at least six months before applying for a home loan. Banks want to know that you can pay back what you borrow, so a stable work history is important. You also need to strive to keep your credit rating good. This means that you need to pay all of your credit card bills on time and handle any late debts before applying for a loan.
First Time Homeowner’s Grant
One thing you can apply for is a first time homeowner’s grant. Your Australia real estate agent can help you find information regarding this grant, which allots you a certain amount of money, usually a few thousand, toward the purchase of your first home. There are a number of rules that govern this grant, and each state may have different requirements. In general, you cannot have owned a home previously and you must live in the home within a year after purchase. This grant is also meant for Australian citizens or permanent residents and not those buying their first investment property. This grant also works for new construction, with the allotted amount actually valued higher for new construction than buying an existing home.
Securing a Home Loan
If you qualify for the first time homeowner’s grant, you shouldn’t have a problem securing a loan for the remaining purchase amount. Make sure you shop around before signing any contracts. Banks have different policies regarding home loans, so you may be able to get a lower interest rate from one bank over another. Remember that a local bank may have higher interest rates than a bank that deals within all of Australia. Whether you opt for a grant or another method of securing financing, a skilled Australian real estate agent can advise you on how to find the best rates and what you’ll need to help secure a loan to buy your home.