Home Buyers' Resources
Home Buyers' Checklist
Follow this step-by-step approach to your new home purchase
to help you make the process a well-informed one!
- The first step is to work out
what you want to achieve and the affordability
of your dream. It is worth spending a little time with someone
qualified to look at your particular situation to work out
the best options and eliminate guesswork.
- The next step in the home-buying
process is to organise a
deposit. If you have
20% plus costs, it will also save on the Lenders Mortgage
Insurance premium, generally payable for loans over 80%.
If you don't have sufficient savings and you have a family
member wishing to assist you, it is possible to put up a
limited guarantee for the shortfall. This is a popular method
to avoid paying mortgage insurance.
deposit? if you have a good enough income you may want
to consider looking at No Deposit home loans (100% loans)
or a Family Equity Guarantee. You will still need to save
for the stamp duties and other costs, including mortgage
- The next step is getting a
pre-approval. An application
with supporting documentation is submitted to the lender.
If the lending criteria is satisfactory, you 'qualify' for
a home loan subject to certain conditions which the lender
provides to you. This includes a satisfactory valuation
of the property being offered for security. This is also
known as a 'conditional approval'.
Tip: It is important
to understand that this is not an offer for finance from
the lender at this stage as there are still conditions to
be met. A pre-approval gives you confidence that you can
shop for a property up to a certain price and it also lets
sellers know that you are a serious buyer.
- Once you have found a property
and negotiated a price, have a qualified person (conveyancer
or solicitor) review the Contract of Sale. A word of caution:
make certain that you have your unconditional approval from
your lender before committing to the purchase ('exchange'
Your conditional approval will list a number of conditions
that will need to be met before giving you unconditional
approval. One of these will be a valuation
of the property which will assess not only the market value
but also other considerations, for example the type of property,
where it is located, the condition, etc. Note: some
properties do not meet some lender's criteria! These
may be studios under a certain size, post-code restrictions
and even a "renovator's dream" can turn into a
nightmare if the bank will not accept the risk of a property
in a bad state-of-repair and you don't have sufficient equity
in the property, or sufficient funds to undertake renovations
Auction sales: There is no turning back
if you have purchased a property at auction as contracts
are binding. It is extremely important to make sure you
have met all conditions before your buy a property at auction.
- Once all conditions are met, the
lender will issue an unconditional approval
and the loan agreement and mortgage documents will be prepared.
This lists all the information about your loan including
the amount, the interest rate, repayments, the term, fees
and charges and other information. It is important to read,
check and understand the details.
- When the documents have been
signed and returned, the process now proceeds towards settlement
Your solicitor and the vendor's solicitor will work out
who gets paid what on settlement day. Apart from paying
the vendor the agreed purchase price, other typical payments
are adjustments for municipal rates and water rates that
the vendor may have prepaid, bank fees, real estate agent
commissions and legal fees.
||T: 02 9972 4452
F: 02 9972 4605