Buying a first house? Congratulations!
Queensland is home to some of Australia’s most affordable homes. Recently, it has also been receiving throngs of people migrating interstate. Sunshine and Gold Coasts are particularly doing well and considered as top lifestyle destinations.
If you’re buying a house in Queensland — or anywhere else — for the first time, here is a handy list of 1st home buyer mistakes and pitfalls to steer clear of.
First home buying mistakes you can avoid
We had a previous blog about the same topic. In this article, we outlined the top 5 mistakes too avoid as a first home buyer which are:
- Thinking you need a 20 per cent deposit (you can have as low as 5% deposit!)
- Waiting to have genuine savings (you can use your rental history instead!)
- Looking for your forever home (not ideal since your living situation is ever changing)
- Champagne taste, beer budget (never purchase property that is way out of your price change)
- Underestimating the costs of buying in Sunshine Coast (there’s more to just paying deposit upfront!)
We have since then uncovered more very common mistakes among prospect and new home buyers — and we would like to stop you dead in your tracks before you make even bigger and costlier mistakes!
#1 Lack of care given in improving your financial record
It is not enough to just be able to pay deposit upfront. You have to demonstrate your capability to service your home loan for 30 years (that’s a really long time) and keep your debt-to-income ratio low (ideally 10% or less).
To know how to buy a first home successfully, read our articles on How to improve your financial record to get mortgage loan and What impacts how much I can borrow.
#2 The devil’s in the details
When buying a first home in QLD, it’s important to do your homework before taking out a home loan. There are a number of features to consider such as the interest rate, repayment period and any fees and charges. It’s also important to compare different Sunshine Coast loans to make sure you’re getting the best deal.
Read: What should I know about different home loan features?
#3 Online calculators can only take you so far
With so many online calculators available, it can be tempting to rely on them to do the math for you. But beware – these calculators can sometimes give you inaccurate results. That’s because they often make assumptions about things like the interest rate and repayment period that may not apply to your situation.
The best mortgage brokers can help you work out your borrowing capacity and all the costs you have to prepare for. They can also tailor mortgage and finance solutions that are specific to your circumstances.
#4 Bank VS broker for mortgage
Here’s what we can say about the mortgage broker vs bank debacle: all qualified mortgage brokers operate under the Best Interest Duty. This means when you work with an experienced mortgage broker, there is a legal guarantee that we will always act in your best interests when we recommend a home loan option to you.
Unfortunately, not everyone knows this best interests duty does not apply to banks. There is no legal requirement for a bank to work in your best interest. They don’t have to legally assess your circumstances nor tell you if another lender would be better for you.Whilst transacting with a bank yourself is perfectly fine, we assure you that working with mortgage brokers Sunshine Coast will give you access to a host of benefits that will otherwise be unavailable to you should you work with a bank directly.
#5 Not asking questions or first home buyer tips
Home buying advice can go a long way
- What lenders have been explored and compared?
- How should I structure my mortgage?
- Am I getting the best interest rate available?
- Should I take advantage of a mortgage break?
- Do you offer loans from a range of different lenders?
- Why did you recommend this loan to me?
- What fees will I have to pay when taking out this loan?
- What features (options) come with this loan? Can you show me how they work?
Read: What questions can I ask a mortgage broker?
#6 Not taking advantage of first home buyer grants
Among the many things to know before buying a house in Australia is the long list of first home buyer incentives grants to help you reduce the costs! The Australian government offers a number of grants and subsidies to help first home buyers ease into homeownership, and these can save you thousands of dollars on your purchase.
In addition to the financial assistance, first home buyers also benefit from other perks, such as stamp duty exemptions and access to specialised home loan products.
Read: First Home Loan Deposit Scheme
Also read: HomeBuilder grant, is it for me?
Need first home buyer assistance?
So, if you are in the market for a new home or thinking about buying one, please give us a call. We don’t want you to make any of the mistakes that we see so often.
And remember, it is always best to consult with a professional who can help guide you through what may be one of the biggest decisions of your life!
Meet Chris Wilson, the heart of Sunshine Coast Financial Solutions (SCFS). With over a decade of experience in finance, Chris started his journey as a broker with Aussie Home Loans in 2009. His dedication earned him the title of Rookie of the Year in 2010. By 2011, he was ready to build a business based on trust and strong partnerships.
