The process of buying or building a first home can be daunting. There can be so many factors and unknowns to consider especially when the process is just beginning. As an almost contradiction to this experience we as humans can be our own worst enemy. The human psyche is a weird and wonderful thing, in many instances we can forgo asking simple questions for the sake of our pride or to not seem incompetent. But when it comes to buying a home there should never be any question that we’re too afraid to ask. To phrase it simply, it’s your future and you peace of mind on the line therefore no question is too basic or pointless to ask. Even if you have asked the same question previously, if there’s still uncertainty around the answer, keep asking the same question until you’re comfortable.
The Elephant in the room – Finance
Some of the biggest questions are always to do with affordability and the financials of buying a home and for good reason too. The last thing you want is to turn your dream into a nightmare because you didn’t clarify a simple points around. Questions like: How much can I Borrow? What are the monthly/weekly repayments? Are the standard questions and are usually covered off with your lender in detail upon any application for a home loan.
If you don’t have a 20% deposit lenders may still be willing to give you a home loan, however it may mean lender’s mortgage insurance will be added to the total loan amount. Lender’s mortgage Insurance or LMI protect the lender in the instance that you’re unable to repay the loan. It’s a variable amount which is determined prior to finalising the loan agreement.
What loan should I get?
An important line of questioning when it comes to getting finance can also be around if you’re getting the best rate, and ensuring that the loan product suggested to you matches your needs. You can avoid paying higher fees or more interest just by simply asking, “what are my/our other options in a home loan package?” ensure that the product meets your financial needs and the needs of your offer or home build. Additional terms fixed or variable are generally thrown around and each loan type both have their good and bad points. To find the best loan for your particular circumstance it’s critical that you understand your current and future financial needs.
What type of property should I buy?
You may be looking for a clearer direction but the property you end up buying is a decision only you can make. Budget, location, size and space and features are all aspects to consider and they must fit your needs without overextended yourself. To help you answer this question spend some time coming up with the pros and cons of types of properties that you’re thinking about and seek advice from people you trust.
Buying an Established Property?
If you’re looking to buy an established property there are generally considerations related specifically to existing homes which is worthwhile to get your head around. Generally the most important considerations with established home is the condition of the property and what costly issues may be lying within the walls of the home. Confirming the build date is a great place to start as it gives you a sense of how much wear and tear the property has endured. The next point to clarify would be to get an indication of any renovations carried out on the home, This information might be a little harder to come by however it remains an important factor as you want to ensure any work carried out on the property were up to code and aren’t covering up any nasty hidden surprises.
When it comes time to make an offer on an established property the best advice is to be in a position to make a solid offer and move quickly if need be, without putting yourself in a detrimental situation of course. This means obtaining pre-approval for any finance, having a solicitor ready to provide council and potentially having any building and or pest inspection providers aware of the upcoming offer. Also known as subject to’s within a formal written offer it is important to clearly specify that your offer is subject to the outcomes of finance, building and pest and any other uncertainties you may have.
What if I’m Building a Home?
If you’re looking to build a home you may ask which builder should I choose? Luckily there are many credible builders available that offer competitive, practical and quality workmanship. It’s important you feel comfortable with your builder as they will be managing the most important investment of your life potentially. The builder you choose must also be able to satisfy the requirements of your build meaning keeptime to timelines and to a budget but also being able to carry out the works you’re looking for in the design of your home. It’s best to be upfront with your builder from the start and carefully detail your requirements. This will remove any uncertainty when it comes time to drawing up a contract for the build.
The contract and all it must cover
Although there are numerous varieties of building contracts, all contract should clearly identify the rights, responsibilities of you , the building and any other parties involved in the process. Contracts can be tricky to navigate through so it’s best to clarify any terms of the contract with a solicitor to ensure you’re completely comfortable with all terms. Provisions around insurance, the final price, inclusions of the build and the progress of payment amongst many other factors should all be covered off within the contract.
The steadfast rule is to clarify all and any doubts you have around your home before signing anything. If in the first instance you’re overwhelmed after discussing anything with your lender, your builder or developer or a real estate agent. Give yourself a few hours or a day or two in order to take a few notes and write down some of the points which you need clarification on.
It does get easier
You can stop renting and get into your own home sooner more informed with Valcon Homes – our first home buyer’s solution gives you the opportunity to enter the property market and build something of your very own.
We want to get you home sooner! $2K is all you need to pay now to get on your way to home ownership coupled with;
- 6-months rental history with a real estate agency
- A good credit history
- You qualify for the First Home Owners Grant
- You are able to fund the 5% balance of the purchase price and costs associated with purchase
*Eligibility criteria. Terms and conditions, credit and lending criteria apply.