HELPFUL GUIDES

First Home Buyers

Buying your first home is an exciting milestone, but it can be overwhelming. Here’s a quick guide to help you understand what’s involved:

Step 1: Assess Your Financial Position

• Review your income, savings, existing debts, and monthly expenses.
• Consider your borrowing capacity using online calculators or by consulting a mortgage broker.
• Aim to save at least a 10-20% deposit, but some schemes allow purchases with as little as 5%.
• Don’t forget additional costs like stamp duty, legal fees, inspections, and moving expenses.

Step 2: Obtain Pre-Approval or a Letter of Recommendation

• Pre-approval is a lender’s indication of how much you can borrow based on your financial situation.
• A letter of recommendation means a broker has assessed your income and can give an indication of what you can borrow
• It’s not a guarantee but gives you a budget range when house hunting.
• Given the heated market more real estate agents want to know they aren’t wasting their time.

Step 3: Research the Property Market

• Investigate suburbs, housing trends, infrastructure projects, and pricing.
• Compare property types: apartment, townhouse, house, or land.
• Factor in lifestyle, commute, schools, and amenities.

Step 4: Engage Key Professionals

• Mortgage Broker: Finds the right loan for your situation.
• Real Estate Agent: Helps identify suitable properties and manages offers.
• Settlement Agent / Conveyancer: Ensures legal documents and title transfers are handled properly.

Step 5: Inspect Properties

• Attend open homes and private viewings.
• Organise building and pest inspections to assess the property's condition.
• Take notes and photos to compare properties.

Step 6: Make an Offer

• Offers are made through the real estate agent.
• You may negotiate the price and conditions.
• If accepted, both parties sign the Contract of Sale.

Step 7: Loan Application and Approval

• Your broker will draft the loan documents for your signature
• The broker will then submit the documents to the lender
• The lender assesses the property, confirms your details, and issues unconditional approval.
• You’ll receive loan documents to review and sign.

Step 8: Prepare for Settlement

• Your conveyancer conducts title checks, prepares legal documents, and liaises with the lender.
• On settlement day, ownership officially transfers to you.
• You receive the keys and can move in!

Key Professionals and Their Roles

Mortgage Broker

• Offers tailored home loan advice based on your financial goals.
• Compares dozens of lenders to find suitable loan products.
• Assists with documentation, submission, and communication with lenders.
• Helps you understand loan terms, features, and repayments.

Real Estate Agent

• Works for the seller but provides information and access to properties for buyers.
• Manages open homes, auction campaigns, and negotiations.
• Guides you on the offer process, including submitting formal expressions of interest.
• Its important to remember that the real estate agent is working in the best interests of the seller.

Settlement Agent / Conveyancer (WA)

• Specialises in property law and manages the legal transfer of ownership.
• Reviews the Contract of Sale and ensures your interests are protected.
• Prepares and lodges settlement documents.
• Coordinates with your lender and the seller’s representative to complete the transaction.

Government Grants & Assistance Schemes

First Home Owner Grant (FHOG)

• For new or substantially renovated homes.
• In WA: Up to $10,000 for new homes valued up to $750,000 (south of the 26th parallel).

First Home Guarantee (FHBG)

• Enables eligible buyers to purchase with just a 5% deposit without Lenders Mortgage Insurance (LMI).
• Available for both new and existing homes.

Stamp Duty Concessions

• Applies to established and new homes.

Home Buyer Assistance Account (WA only)

• Offers up to $2,000 reimbursement for expenses like inspections, mortgage fees, and conveyancing.

Other Programs

• Shared equity schemes (Keystart in WA).
• Super Saver Scheme (withdraw voluntary super contributions).
• State-specific grants or discounts (e.g., regional or rural incentives).

Always check current eligibility and guidelines on your state government’s website.

Understanding & Completing a Contract of Sale

A Contract of Sale is a formal legal document outlining the terms of purchase.

• Parties involved: Full legal names of the buyer(s) and seller(s).
• Purchase price: The amount agreed upon for the property.
• Deposit: Typically $5000 to $10000 paid after acceptance of the contract
• Inclusions: Fixtures and fittings (e.g., dishwasher, blinds).
• Conditions: Subject to finance, building inspection, pest inspection, or other special terms.
• Cooling-off period: Timeframe to withdraw without major penalty (not applicable in WA).
• Settlement date: Usually 30–90 days from signing.

How to Complete:

• Review each section carefully.
• Insert accurate personal and financial information.
• Clarify any unclear conditions or inclusions with your conveyancer.
• Sign in the presence of a witness if required.

Tips:

• Don’t rely on verbal promises, real estate agents are like used car salesman — ensure they’re written into the contract.
• Have your conveyancer review before signing.
• Keep a signed copy and confirmation of all changes.
• Give a Mortgage broker 21 – 28 days for finance approval

Additional Tips for First Home Buyers

• Budget realistically: Allow a buffer for unexpected costs.
• Check your credit score: Correct any issues before applying.
• Understand interest rates: Fixed, variable, or split loans all have pros and cons.
• Know your repayments: Use calculators to estimate monthly costs.
• Plan your move: Utilities, mail redirection, insurance, and removalists.
• Stay informed: Subscribe to property newsletters or follow reputable mortgage brokers online.

This guide is general in nature and does not constitute financial or legal advice. Always consult a licensed professional for your specific situation.