Moving out of your parents’ place and into your own
Contemplating moving from your parents' place to one of your own? Use these six tips to become a successful first-time homebuyer.
1. Start saving for a depositIf your budget allows, saving for a deposit is a very good idea. It demonstrates that you're invested in purchasing a home and gives you a better chance of getting your bond approved by the banks. You could be in line for a reduced interest rate if you're able to put together a deposit, and best of all, a deposit means you would require a smaller loan and therefore pay a lot less interest over the term of your loan. Use our Deposit Savings Calculator to set your goals.
2. Build your credit scoreA good credit score is important when applying for a home loan. This three-digit number is used as an indication of how creditworthy you are. The higher your score, the better your chances of qualifying for a bond and getting a good interest rate. Keep a good credit score by always paying your bills in full and on time and not applying for new credit or taking on new debt during the period when you're buying a home.
3. Get pre-approvedGetting pre-approved for a home loan makes sense in two significant ways. It gives you an accurate idea of how much you can afford, so that you can search in a realistic price range. And a BetterBond Verified Pre-approval Certificate, valid for three months, gives your Offer to Purchase an edge that other buyers likely won't have. It shows sellers and estate agents you're serious about buying, and it proves you can secure home finance. For an idea of your home loan affordability, let us pre-approve you for a home loan.
4. Choose your areaThere are several things to think about when choosing where to live. How close is it to friends and family, how far are the shops, malls, gym, bars, restaurants and clubs that you like to go to? How long would it take to get to work, or could you work from home? What type of property would you like - flat, townhouse, freestanding home. Is the neighbourhood as lively or laid-back as you like? Find out about crime in the areas you're keen on - security is an important part of homeownership.
5. House-huntBefore you start your house-hunt, decide what you're looking for - size, outside area, security, parking, etc. Look online to see what is available. Set up alerts to get new listings on the various property portals and speak to estate agents who know the area. View different properties and at different times of the day to find the ones that suit your needs.
6. Make an offerOnce you find a place you love, the next step is putting in an Offer to Purchase (OTP). This is a very exciting part of homebuying, so do your homework to ensure your offer gets you the deal. You should clarify any questions you might have beforehand because an OTP is legally binding once you and the Seller have both signed. Remember that a BetterBond Pre-approval CertificateBetterBond Pre-approval Certificate could strengthen your OTP because it confirms the home loan you could qualify for. It gives both the Seller and Estate Agent the comfort that you can indeed commit to the amount you are offering and that you will be able to secure a bond.
If homebuying feels a little overwhelming, take a deep breath as you remind yourself that you're on your way to owning your first home and securing your financial future. It will all be worth it!