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Buying your first home

As a first home buyer, the thought of securing a loan may seem overwhelming, especially when you take into account that buying a house is one of the biggest financial decisions you’ll ever make.
Category: Personal

Saving for a deposit

The more you can save for a deposit the better. As a guide, we recommend that you aim for a deposit of about 20% of the purchase price of the home you would like to buy.

The greater your deposit, the less money you’ll need to borrow and less interest you will pay!

Having good saving habits will also help when it comes to gaining approval for a loan.

If you have less than 20% you will most likely need to pay a one-off payment, known as Lenders Mortgage Insurance to secure your loan.

4 Tips for boosting your chances of home loan approval

  1. Get a copy of your credit report It is important that you have a good credit history. You can request a free report from websites such as Check your Credit, Veda or Experian. The report is a snapshot of your current and historic credit information. 
  2. Show you can save money A healthy savings history will give us confidence you will be able to meet the requirements of your loan.
  3. Manage any existing debt Continue to meet the repayments on existing debt and don’t apply for any other forms of new credit.
  4. Job stability We will want to see evidence that you are financially stable, usually in the form of recent pay advices.

How much can I borrow?

The amount you can borrow will depend upon your current financial position. We will consider your income and assets, as well as your expenses and liabilities. You can get an indication of how much you may be able to borrow by using our borrowing power calculator or you can speak with one of our home finance specialists.

If you’re an eligible first home buyer, you may be entitled to the Federal Government’s First Home Owners Grant. Our lending specialist can help you with this. The Federal Government sets the amount of the First Home Owner’s Grant and it may change without notice. Visit www.sro.tas.gov.au/fhog  to find out more.

What will my repayments be?

Repayments will depend on the amount of money you borrow. Use our handy Loan Repayment Calculator to get an indication of how much your repayments will be.

There are several simple things that you can do to reduce the amount of interest you pay over the term of the loan.

Consider making fortnightly or weekly repayments or increasing the amount of your regular repayments.

Additional costs

As a guide, set aside 5% of the property purchase price for additional costs such as stamp duty, mortgage registration fees, pro-rata council rates and legal conveyancing fees.

Home loan options

There’s really no need to apply for multiple home loans from multiple lenders if you do your homework. You can use our online Key Fact Sheets generator to compare our home loans with those of other providers.

Carefully consider all the features and benefits of a loan and don’t be tempted solely by the lowest rate. Additional features such as an off-set account or the ability to make extra repayments without penalty and a redraw option can make a huge different to the total interest you pay and the overall suitability of the product.

As a guide, there are three choices when it comes to interest rates:

• Variable rate – as the interest rate varies, so too will your loan repayments. You also have the option of making additional repayments, along with the ability to redraw.

• Fixed rate – the interest rate remains fixed for a set period, ensuring your repayments remain exactly the same each month (great for budgeting).

• Split rate – as the name suggests, you can split your loan between fixed and variable.

What next?

Make an appointment to talk to us. You can meet one of our friendly, home finance specialists in your local branch, your office or your favourite cafe!

Call 1300 306 716 to make an appointment today.



Things you need to know:

This is general information only and does not take into account your personal circumstances. Before acquiring any financial product, you should check if it is suitable for your needs and where appropriate seek independent advice. Terms and conditions, including fees and charges apply to Bank of us home loan and residential investment loan products. Full details are available on application. All applications are subject to Bank of us’s credit assessment criteria.