Buyers Guide Buyers Guide - Page 13

Four steps to securing your home loan 01 Set your goal Once you know the type of property you want, and have a rough idea of what it’s likely to cost, set yourself a target for saving a deposit. Remember, if your deposit is less than 20% you may need to pay Lenders Mortgage Insurance, or get a guarantor to offer their property as security – be sure to factor this into your plans. 02 Talk to a broker Before you start actively looking for a property, it’s worth speaking with a broker. They’ll give you an accurate assessment of your borrowing capacity (more accurately than an online calculator) and determine your eligibility for government grants. Your broker will explain all the government fees and charges and ensure you’ll be eligible for a loan when the time comes to buy. 03 Get the green light Whether you’re bidding at auction or placing an offer with an agent, you’re in a stronger position with a pre-approval. Pre-approval is essentially a green light from a lender to spend up to a certain amount. This means you’ll know how much you’ve got to work with. You’ll usually receive pre-approval within a few days of application. It’s generally valid for three to six months, and assumes your financials stay the same. 04 Close the deal Whether you buy at auction, by private treaty or off-the-plan, securing a property is cause for celebration. But before you pop the champagne, you’ll need to move fast to organise a few important things: A  holding deposit – usually $500 to $1,000 or 5-10% for auction purchases A  solicitor/conveyancer – your broker can recommend someone they trust to take care of the legal work  Notify your broker – so they can quickly move you to formal approval. Tip Final credit assessment During the time when you are closing the deal, the lender will value the property, process your application and make a final credit assessment. If you haven’t already, you’ll also need to pay the full deposit at this point. buyer's guide