Guide To Home Loans For First Home Buyers A first home buyers guide to the assistance scheme, the grant, and applying with a broker.
Are you searching for the best home loan rates as a first-home buyer? There has been a major boom in Australia’s housing market over the last 2 years which has impacted individuals wanting to buy their first home or investment property making it difficult to understand the ins and outs related to first-home buyer options and available home loans.
Understanding the schemes and options available to assist property buyers who are in the process of searching for the best home loans can be difficult and daunting. This is why the team at Greenline Home Loans have devised this guide to assist you with advice and options available for both first-home buyers and those looking for home loans for investment properties.
First Home Buyers Assistance Scheme
The first home buyers assistance scheme aims to provide a concessional rate for stamp duty or an exemption for the full stamp duty cost depending on specific circumstances. The first home buyers assistance scheme is suitable for those who are purchasing an existing home, purchasing a new home or intending to build a new home on existing vacant land.
It is important to ensure you meet the eligibility points and further requirements for the first home buyer assistance scheme before applying. Reach out to the team at Greenline Home Loans today for assistance with understanding the best home loan rates and the various features available such as redraw facilities, unlimited additional deposits and low-rate home loans.
First Home Owners Grant
The first homeowner’s grant is a national scheme for people buying their first new home. The purpose of the grant is to offset the outcome of GST regarding home ownership. Each state or territory manages this national scheme under specific legislation and may have certain requirements.
When applying for the first homeowner’s grant, it is vital to ensure you are eligible in regard to the state or territory where you are looking to buy or build your first home. Under the scheme, eligible first-time homeowners are eligible for a one-off subsidy payment towards their new home.
Residential Investment Property Loans
If you’re looking at purchasing an investment property, there are several benefits of acquiring a residential investment property loan such as:
- Repayment holiday – in a situation where a property is unoccupied, a repayment holiday may be used (generally up until 12 months) where you can take a break from making repayments
- Offset account – many investors utilise an offset account as a replacement for their everyday account which may act as a savings account. The balance on your offset account will reduce the interest you are charged.
- Interest-only payments – interest-only home loans allow buyers to pay interest for a specific amount of time (generally 5 to 10 years), meaning the saved money can be used for additional investments.
- Line of credit facility – line of credit facility allows you to have access to a predetermined amount of credit allowing you to apply for additional money without having to apply for an additional loan. This borrowed amount will be secured against the equity you have in your existing property.
To find out more about the options for purchasing an investment property, reach out to the friendly team at Greenline Home Loans who can answer any questions you may have and guide you through the process!
The Process Of Applying For A Home Loan As A First Home Buyer
Applying for home loans as a first home buyer can be daunting and stressful when you are unaware of the best home loan rates and the process of obtaining them. It is best to engage with a mortgage broker as soon as you are ready to investigate home loans as the mortgage broker will assist you with finding the right lender, understand your circumstances and needs and will start the application process and begin filling in the required paperwork with you.
A mortgage broker will ensure they find the best home loans for your specific circumstances and financial position to meet your goal of buying your first home or investment property. When you first meet with your mortgage broker, they will need to understand your credit score, your income, and other financial information to give you relevant home loan information, which is why it is important to prepare as much information as possible beforehand. From here, your mortgage broker will inform you of how much you will require for a down payment depending on your personal circumstances and the details of the property you are wanting to purchase. After these steps are complete, your mortgage broker will be able to advise you of your monthly repayments and assist you with the application process.
Reach out to Greenline Home Loans today!
First home buyers guide: FAQs
What is the First Home Buyers Assistance Scheme?
A scheme that gives eligible first home buyers a concessional rate of stamp duty, or a full exemption, depending on their circumstances. It covers buying an existing home, a new home or vacant land to build on. The thresholds and eligibility rules are on our First Home Buyers Assistance Scheme page.
What is the First Home Owners Grant?
A national scheme for people buying their first new home, introduced to offset the effect of GST on home ownership. Each state or territory administers it under its own legislation and requirements, and eligible buyers receive a one-off payment towards the new home. The amounts by state are on our First Home Owners Grant page.
How much can a first home buyer borrow?
It depends on your income, expenses, deposit and the lender's policy. When you first meet your mortgage broker they will need your credit score, income and other financial information, then advise how much deposit the purchase needs and what the monthly repayments would be. Our borrowing power calculator gives a first estimate.
What should a first home buyer prepare?
A checklist from the article: your credit score, proof of income and your other financial information for the broker; an understanding of the schemes you may be eligible for and their rules; a deposit plan; and a shortlist of loan features you want, such as a redraw facility, unlimited additional repayments and a low rate. Preparing as much as possible beforehand speeds the process.
What are the article's tips for first home buyers?
Research the schemes and grants available in your state before you buy; engage a mortgage broker as soon as you are ready to investigate loans rather than after you have found a property; prepare your financial information early; and compare the features of the loans you are offered, not only the rate.
Can a first home buyer buy an investment property?
The article describes the features of a residential investment property loan (a repayment holiday, an offset account, interest-only payments, a line of credit) for those looking to invest, but the first home buyer schemes have their own eligibility rules about the home you buy, so check the scheme pages and talk to a broker before deciding.
Why use a mortgage broker as a first home buyer?
Because applying can be daunting when you do not know the lenders or the process. A broker finds the right lender for your circumstances, starts the application, fills in the paperwork with you, and tells you what deposit and repayments to expect. Greenline's brokers have access to 50 lenders and strong relationships with several major banks.
How do I buy my first home, step by step?
In the article's order: understand the schemes and grants you may be eligible for; engage a broker as soon as you are ready to look at loans; give the broker your credit, income and financial information; learn the deposit you need and the likely repayments; then apply, with the broker guiding the application through to buying your first home.
Where to next
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Articles are general information. A Greenline broker can look at your own situation and compare options from 50+ lenders, with no obligation.
This article was published on 21 December 2022 and describes the lending environment at that time. Rates, grants and lender policies change.