Making assumptions when buying your first home can cause disappointment and heartache. In this article CRAIG WILSON, CEO of PiC Group, outlines the 5 mistakes first home buyers need to avoid.
Getting a pre-approval.
More and more lenders are either opting out of offering pre-approvals or reducing the amount of time they spend on assessing them.
They are either just doing credit checks or saying you are pre-approved but not actually looking at your information for example payslips or bank statements.
Thinking you need a big deposit
Having a 20% is ideal but let’s be real, saving a 20% deposit can be hard. Especially when property prices are high, the cost of living is high and wages in comparison are significantly low.
You can get property with a deposit between 8-10%, maybe even 5% deposit, but you then need to consider there will be Lenders Mortgage Insurance and additional costs.
Underestimating the costs of buying property in Brisbane
You can get away with only having a 5% deposit to be able to purchase a property, but there are additional costs like Lenders Mortgage Insurance, Stamp Duty, Government Registration Fees, Council Rates and Water, Insurance and even your Solicitor Fees that you need to also consider having on top of your deposit.
Thinking your pre-approval is a guaranteed approval
While you should get pre-approval prior to buying a home to get an idea of your borrowing capacity, it’s not a guaranteed approval.
In order to get full loan approval, the lender requires a signed contract so they can then investigate and see if the property fits their requirements, and they will also look future into your finances if needed.
Not having the right clauses in your contract of sale
Queensland has a standard Contract of Sale which is used for majority of properties however, if you feel uncomfortable about signing a Contract ALWAYS have your solicitor review it before signing.
Never be fooled by someone who says you can sign and make changes later, because that is not always guaranteed, and you may lose the deal altogether.
Craig is the founder of PiC Group since 1993 and SiNC Surveys, and a successful private investor in his own right, coming from a background in the insurance, financial planning and real estate development industries.
General Advice Warning: This blog is not designed to replace professional advice. It has been prepared without taking into account your objectives, financial situation or needs. You should consider the appropriateness of the advice, in light of your own objectives, financial situation or needs before making any decision as to what is appropriate for you.