Tips for first home buyers

Getting ready to apply for pre-approval

Buying your first home is an exciting adventure, and one that can be tricky to navigate without a map to guide you. The key to success in the world of mortgage pre-approval is being prepared and getting the right advice.

The best time to seek advice is before you begin house hunting. This is because it’s important to do your homework first and understand what you can afford. But don’t worry, you won’t need to figure this all out on your own. This is what we’re here for.

Here are our top tips for getting “pre-approval ready”.

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1. Save a deposit
   Begin saving as soon as you can because the bigger the deposit, the better your chances are of getting the loan you need. It also puts you in a better financial position and less hoops to jump through.
   
   To give you an idea of how much you will need to save. For a new build property, you will need a minimum of 10% deposit. For an existing home, you will need between 10 – 20%.
   
   A good savings history will also go in your favour as it shows you are able to manage your money well.
   

2. Clean up your credit
   If you have any credits arrangements that you’re still paying back, focus on getting those paid off so that you are not owing anything. You want to eliminate these costs from your weekly budget.
   
   If you have multiple credit arrangements we can consolidate those into one to make it easier for you to manage.
   

3. Pay off your credit card each month
   Lenders want to see that you manage your finances well and will see your credit card debt as a red flag. Show them that you are living within your means by paying off your card at the end of each month, and don’t take on other short term debt.
   

4. Watch your spending
   Lenders will look at 3 months of bank statements and will take note of things such as how often you buy takeaways, as well as things like unauthorised overdrafts. As you lead up to seeking pre-approval, be conscious of your spending and act like you already have a mortgage to pay.
   

5. Understand your budget
   You will need to note what your weekly and monthly expenses are when completing forms for lenders. Take some time now to note down your expenses such as phone bills, gym memberships, insurances, etc as well as your average spend on groceries, petrol and other regular costs. Knowing these is essential for being able to create a budget.

We encourage you to get us involved in the early stages when buying a home is on the horizon. That way we can ensure your finances are ready to go when you are.

We hope you find these tips helpful and stay tuned for more blogs coming soon with more advice for first home buyers.

If you have any questions or would like to get the pre-approval process started, book an appointment with us. Click here to contact us online or phone 0800 562 022