First Home Buyer

Home Loans for First Home Buyers

First time home buyers might can get confused with the process of home loan application. Here are a few tips to make the process simpler.

Fixed Rates
Many families look for a stable home loan and what’s appropriate for them is a fixed home loan.  A fixed rate is generally higher than the variable however, you have the security of knowing what your repayments will be for the fixed term.

Variable rates
Some would go for variable rates because of the interest rate is generally lower.   However, the repayment can go up if the Reserve Bank of Australia lifts interest rates. 

Split Loan
With the fixed and variable home loan both having pros and cons, many first time borrowers opt to go for a split home loan. This type of home loan has both the stability of a fixed home loan and the flexibility of a variable one.

Deposit
The deposit that you will require will depend on the type of property that you want to buy and the home loan type that you require. The usual deposit rate is within five to ten percent of the total property value and, some lending companies would like to see your saving history for up to six months.

Other costs
Aside from the deposit, you will have to cover other costs such as establishment fees, transfer fees, legal fees, loan application fees, mortgage insurance and the stamp duty. The values of which vary from one lender to another. Meanwhile, the value of the stamp duty varies per state.