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Blog   »   September 2015   »   How To Prepare For Your First Home Loan

How To Prepare For Your First Home Loan

How To Prepare For Your First Home Loan?

Approaching a lender for your first ever home loan can be a little daunting. Even though the internet is full of advice and lenders are more than willing to espouse the benefits of their own product over the next one. This is where a good broker like Hunter Business Finance can assist and with low rate, fixed rate, redraw, offset and split loan, it may seem like your banking without tears dictionary (otherwise known as Google) will be getting a workout and you would be right.

But let’s stop for a minute and back up. Before you even get to that point there are a few things you need to address to make yourself attractive to a lender.

Deposit ?

You have all heard of deposit right? That lump of money that you need to have handy so that the amount you borrow is less than the purchase price of the home?

Well are you aware that a deposit is not just about having a sum of money? It’s about demonstrating to a lender that you have the capacity to save money.

A lender is not going to be happy with a deposit that just happens to show up in your account a week before you want to buy the house. Did you just pop down to the casino and have some luck on black? Or did you go to dad and threaten to move back in? To a lender it doesn’t matter.

They want to see that money in your bank account and they want to see it sitting there for at least 3 months. The professionals at Hunter Business Finance can and will lead you through the mine field, so speak to them first. This trips up a lot of young buyers as some of them do get the money from Mum and Dad, but remember the lender is looking at you, not your Mum and Dad. It’s the home buyer that they will be assessing. So remember the word…savings. It’s very important.

Credit References

Another trap is your good old credit file. Veda Advantage (do a Google search) holds the credit information for the majority of Australians and its information that you can access. It is worth your while to have a look beforehand at what a lender is going to see when they assess your credit history. Take a good look at it. Is there anything there that shouldn’t be? Is there an unpaid bill, loan or credit card that you don’t have? If there is, deal with it.

You can contact Veda and dispute something on your file that you believe has been entered incorrectly or flat out shouldn’t be there.

Because don’t forget this is a critical piece of information that all lenders will access to evaluate you and how you pay off debts.

Remember this file will show not only loans that you have running at the moment but also any you have applied for in the last 2 years. So leading up to when you wish to buy your house, don’t take out any new loans or credit cards. New debts are debts without history and lenders want to see your history.

Savings and history, two critical words that first home buyers need to hold onto like Gospel. Of course always chat to your broker about your plans because some things are not necessarily deal breakers and other things that you may think is a good idea may not be from a banks point of view. Remember your broker is not just the person you come to when you want a loan; they are also the person that can give you very real advice about preparing for one.

Posted: 9/09/2015 10:11:13 AM by Hunter Business Finance | with 2 comments

Comments

Thank you for your positive feedback, it is greatly appreciated.
Hunter Business Finance , 20/10/2017 10:26:54 AM
Great post! It is important to take a serious decision in buying your first home. You would probably need to take the time to prepare yourself in every aspect in order to make your home a blessing, and not a negative experience.
Personal Loans Melbourne Australia, 19/10/2017 11:48:24 PM



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