Purchasing your first home can be a daunting process, but you can make it go smoothly by having a firm understanding of your financial commitments, and the best ways to to apply for a loan. Mist people can’t afford to buy a home without a loan, so you aren’t alone in this, around 3 million Australians do so every year!
Your best course of action is to confer with experienced loan professionals like Parramatta mortgage brokers, who can lend their expertise to your unique situation and needs. If you are prepared and know what to expect, getting a home loan can be stress-free and can get you into your dream home quickly!
The following are some useful tips for home loan approval that can help the first-time buyer!
Eligibility Criteria – Knowing the criteria of home loan eligibility criteria in advance will help make the process of getting a home loan a lot easier. Every lender has a slightly different set of requirements, but most will require you to pay a 20% deposit, have a steady employment history, or have a proven savings record to ensure that you will be able to make regular repayments across a term that could possibly run as long as 30 years. They will also want to check your credit report in order to ascertain if your finances are in order. It makes perfect sense, because, after all, they will be lending you hundreds of thousands of dollars!
Your Credit Score – Maintaining a good credit score is the key to successfully applying for and getting a mortgage because it demonstrates to potential lenders that you have a solid financial status and a dependable repayment history on your credit cards and other personal loans. Australia’s credit rating agencies can let you know exactly where you stand. It’s a fact that a history of making late payments will damage your score, but if you can manage to pay your bills and debts on time for a period of six months prior it can improve your credit rating.
Stable Employment – Having a steady job that gives you a regular source of income will prove to be essential when applying for a home loan. Your potential lender will want to see solid evidence that you have the ability to make regular repayments over an extended period of time. Therefore, its very important that you remain in the same job throughout your application to demonstrate the stability of your employment. There are some factors that can affect this positively, such as receiving a promotion, or a new job that pays a higher salary! If you are thinking of changing jobs while applying for a mortgage, check in with your prospective lender to discuss it first.
Prepare Your Deposit – A 20% deposit based on the property’s value is going to be required by any lender before they will consider approving a loan for you. Getting your deposit together demonstrates that you have the ability to repay your mortgage which will build their confidence in making an investment in you.
