First Home Loans

Becoming a first home buyer is one of the most important financial decisions you are ever likely to take. If you are unfamiliar with how the process works, and what is required in order to obtain a first home loan, it can, however, seem a little daunting. 

For instance, with so many different home loan products to choose from, how do you decide which loan or lender is going to be right for you?

The good news is that our team of highly experienced mortgage brokers will help you engage with the process throughout. In addition, we are able to access the loan products of more than sixty different lenders, so you can be confident that any first home buyer loan we arrange on your behalf will be geared to suit your specific needs.

Getting a first home buyer loan

Check out our quick and easy-to-follow guide to the steps along the way to securing a first home buyer loan.

1. Getting started

It is very quick and straightforward to get started on the journey towards your first home loan. Click this link to answer a few questions, and then we will arrange a meeting (in person or online, depending on what works best for you) to catch up and talk through your property goals and how you best achieve them.

2. The right lender

As an experienced mortgage broker, we have access to the loan products of more banks and lenders than individual borrowers. That’s why we can look at the comparison rates of around 60 different financial institutions to find the home loan that is best suited to your needs.

3. Preparing for pre-approval

Once we have found the right loan and the best lender for your first home loan, our mortgage brokers will take care of the administration, including lodging all of the necessary documents, ahead of you receiving pre-approval.

4. Determining how much can you borrow

Once you have received pre-approval for a home loan, your borrowing power, i.e., the amount of money you can borrow, will be determined. Pre-approval generally lasts for three months and gives you a clear idea of the price range you should be searching in.

5. Closing the deal

Once you have found a property that meets your needs and made an offer, we will continue to work on your behalf and monitor your application so that we can respond quickly to any potential issues

6. Seeing you through the settlement stage

The final stage of the process is settlement, when your lender releases the funds and the purchase of your property is finalised. We will oversee this last step for you to make sure there are no last minute hitches.

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Loan types and features

As a first time home buyer, there are a variety of loan types available to you. We will help you to understand the benefits of the different types of loan that you can access, and answer any questions you might have about any of these loan products. 

Variable rate loan

With a variable rate home loan, the interest rate that you are charged can rise or fall, with changes usually being determined by your lender in line with rates set by the Reserve Bank of Australia. A variable rate home loan means that your monthly repayments will change, i.e., you could be required to pay more or less in any given month. These loans usually come with features that give you some flexibility, such as an offset account, being able to make additional repayments, or to redraw funds from your loan account.

Fixed rate loan

With a fixed rate home loan, your interest rate and therefore the repayment amount does not change, even if RBA interest rates rise or fall. This means you have certainty as to your monthly repayments, especially helpful in the early stages of your loan. At the end of a fixed term agreement (which will usually be for less than five years), you may have the chance to continue (perhaps at a different rate), switch to a variable rate loan, or adjust to a loan where a portion is fixed and a portion is variable.

Packaged loan

A packaged loan is one where a number of financial products are combined together in order to create a package that includes more than simply a loan. For instance, it can include discounted interest rates on a fixed or variable rate loan, a waiving or reduction of fees, or discounts on other products from your lender. There will usually be an annual fee charged for a packaged loan.

Introductory rate loan

With an introductory rate loan (also frequently known as a honeymoon loan), you benefit from a lower interest at the outset of the loan, generally for between 1 and 3 years, after which the rate will change, usually to the lender’s standard variable rate (although this won’t always be the case), This sort of loan is especially beneficial for first home buyers, as it can provide additional resources to buy fixtures and fittings, etc., when you move into your new home. 

Interest only loans

An interest only loan means that for a set period of time at the outset of your loan, you are only repaying the interest, rather than the principal of the loan. This means that during the period your repayments are lower, which is especially helpful for first home buyers as you have access to more disposable income when you first purchase and move in to your property. With some interest only loans, you can make over or additional payments if you are able to do so, which shortens the length of the mortgage and the total amount you have to repay.

Guarantor Home Loans

This variety of home loan uses the equity that has been built up in another person’s property (i.e., parents, grandparents, etc.) as security against your loan. The guarantor is not required to pay any money — instead, part of the equity in their property is essentially added to your deposit, increasing its value and the funds you have available, which in turn means you are then able to borrow more. 

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Loan Calculators

These calculators can be used to help you have a clearer understanding of how much you are able to borrow, as well as how much Stamp Duty you will be required to pay.

How much money can I borrow?

It is important to have a clear idea as to how much money you are going to be able to borrow, as this will help to determine the value, type and location of properties you can realistically afford to look at. 

How much Stamp Duty will I have to pay?

The Stamp Duty requirements in each state and territory of Australia are different, so use this calculator to work out how much you will be required to pay when you purchase your first home. 

First home buyer FAQs

Answers to the questions most first home buyers want to know.

How large a deposit do I need to purchase my first home?

Generally speaking, a lender will require you to have a 20% deposit in order to give you a first home buyer loan. In some circumstances, a lender may accept a smaller deposit, i.e., 5% or 10%, but in this case you will be required to pay Lenders Mortgage Insurance (LMI). Adding LMI could, however, mean that you ultimately end up paying more for your home loan. 

How do I know how much money I can borrow?

A number of factors will determine how much money you are able to borrow for a first home loan, e.g., how much you earn, your monthly expenditure, your access to deposit funds, etc. Our loan calculators are a helpful way of getting an indication of your borrowing capacity, but for a more detailed review of how much you are eligible to borrow, please get in touch to arrange a meeting and assessment. 

How do I know which loan and lender is right for me?

It can be difficult to understand what sort of home loan is right for you if you aren’t familiar with how the loan industry works. However, as specialist mortgage brokers, we have access to the financial products of more than 60 different lenders, and so can ensure you are getting a mortgage and a deal that is right to meet your specific needs.