Are you a first home buyer?
Buying a first home can be a stressful and challenging task and is often the first big investment we make.
Speaking with a First Stop Lending consultant before you find your new home will help determine the loan type and features you need. We will also manage the the loan application process and take the worry and fear away from you. Rest assured that our First Stop Lending professional qualified staff will do everything possible to keep you informed and stress free.
First Stop Lending will also help you organize your First Home Owners Grant (FHOG) if applicable.
Step by step guide to buying your first home
Find out how much you can borrow
Before you start searching for a property, find out how much you can borrow. This will help you narrow down which properties you should inspect. Our lending managers will manage the process of obtaining a conditional loan approval (pre-approval) so that you can start looking for your new home or investment.
Finding a property in your price range
Once you are familiar with your borrowing capacity you can start searching for a property. You need to research the surrounding area, from schools, infrastructure, shops, etc. to make sure this will be a good investment.
Making an offer
Making an offer is an important part in the process of buying a property. A copy of the contract of sale should be obtained as soon as possible and examined by your solicitor or licensed conveyancer.
Once an offer has been made you may be asked to pay a small deposit (0.25%), however this doesn’t mean that the property is yours and it will get taken off the market. It only proves that your offer is serious. The seller can take as many offers as he wants.
The contract is a legal document that contains the details of the sale, including the purchase price, the address of the property, title reference and plan number, building inspection reports, a list of any chattels and fittings included in the sale and the settlement date (the date on which the property becomes yours).
If everything is okay with the property and the seller accepts your offer you can then sign the contract of sale and pay a 10% deposit.
Cooling off period
After the contract has been signed you have a 5 working day (can be negotiated to be more/less) cooling off period. This means that after entering into the contract the purchaser has five working days in which to “cool off” or rescind, however the seller is locked into the contract and cannot withdraw from the sale. If you decide to rescind, it will cost you 0.25% of the sale price.
Organise a formal loan approval
After the purchase price has been agreed on , formal loan approval should be obtained. To arrange formal loan approval you should immediately fax the front page of the contract to the person or organization that arranged your conditional approval. They will then organize a valuation if applicable. If the valuation is satisfactory to the lender and the mortgage insurer (if applicable) formal approval should usually be achieved. Pest and building inspections should also be done at this stage.
The date of the settlement is the date that you take legal ownership of the house or unit. In NSW this usually takes place 6 weeks after the date of contract (although this can be altered with agreement by the vendor and purchaser).