First Home Buyer

Buying a home for the first time can be daunting, especially when it comes to choosing a home loan. Carruthers Financial Services can help you find the right loan with our unique combination of people and technology. We make borrowing faster and easier, while giving you the personalised service you deserve.

To help you get started consider these eight factors when applying for a home loan.

1. How Much Can You Afford to Borrow

The first step is to work out how much you can borrow. Look at your income and all expenses, debts, regular bills to work out how much you can put towards a home loan. Most Lenders will base the size of your home loan on your capacity to meet the repayments. Generally Speaking loan repayments should not exceed 30% of gross income. Use our calculator to find out how much you can borrow.

2. Deposit amount

For most lenders, a minimum of 5% of the purchase price is required as a deposit. However, the more money you can save for your deposit the better off you’ll be. Repayments will be reduced and you’ll save money over the life of your loan.

3. Savings history

Lenders require proof of savings history in the form of bank statements that show regular deposits. You will need at least the last six months’ statements, which should add up to at least the 5% minimum deposit.

4. Types of home loans

In today’s competitive market, finding the right loan can be a complicated, drawn out process. What may be suitable for one person may be inappropriate for another. To help simplify the process, familiarise yourself with what’s available. Also take into consideration your goals and financial circumstances.

5. First home owners grant

If you have never owned a home before and you are purchasing a new property, you may be eligible for the Federal Government’s First Home Owners scheme. This one-off tax free payment of $15,000 can be used to help fund your additional expenses or in some cases may be used a deposit. Various state government schemes may also be available so check with your relevant State Revenue Office.

6. Stamp duty

Stamp Duty is a state government tax based on a property’s selling price. First home buyers in some states may be entitled to a reduction in stamp duty costs.

7. Lender Mortgage Insurance (LMI)

If you borrow more than 80% of the property’s value, you will probably have to pay lender’s mortgage insurance. This insurance protects the lender should you default on the loan.

8. Additional costs

Apart from stamp duty and Lenders Mortgage Insurance, there are a number of additional expenses you need to take into account when buying a home. Costs include loan application fees, solicitor/conveyancing fees, building/council inspection, pest inspection, home and contents insurance, moving expenses and utilities connections.

Free Home Buyers Guide
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  • Hints in the buying process
  • 10 steps to buying a home
  • Apply for a loan
  • Jargon Buster
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David Carruthers is a credit representative (Credit Representative Number [400226]) of BLSSA Pty Ltd (Australian Credit Licence No. 391237).