INTRODUCTION
By Julie Valetic LEA, BSc. Director - Let's Get Real Estate - March 2010
Finance can and often is the deciding factor in enabling the purchase of a property and therefore it is important to understand a bit about the complex financial world that we are living in.
A finance approval for the purchase of a property depends on a number of factors including, but not limited to:
- Your income
- Your Savings history
- Your deposit amount
- Your credit rating or score
- Any first home grant, if applicable
- Your employment status and history
- Current and future projected interest rates
- The property price and all other costs of purchase
- The rental estimate on the property if it is an investment
- Lending criteria and policy of the individual lender:
for example, some lenders have restrictions on the sizes of properties they will lend on and the location they are in.
When looking for finance, although options now may be more limited than prior to the GFC, or should I say especially now that options are limited, it is wise to talk to a good finance broker who can help you through the pitfalls and give you the best chance of buying your dream home.
Below are some links to mortgage brokers and some financial information websites that may be of interest.
- CANSTAR CANNEX - Compare interest rates & star ratings for loans, cards, accounts, insurance, investing!
- AUSSIE Mortgage Broking
- How Much Can I Borrow?
- Stamp Duty Calculator
The big 4 banks - CBA, Westpac, ANZ, NAB
Sometimes you may find the best rate, but not meet the lending criteria, and have your finance fall through as a result. Other times you may not realise you can qualify for a better rate, and inadvertently you could go along with a more costly product.
Remember to check out the borrowing capacity calculators
to get a rough idea of what you can borrow, then ensure you firm this up with your broker or lender before you commit to a purchase, perhaps getting a pre-approval as well.
