Your borrowing power is determined by your current income and financial commitments as well as your savings and credit history. You should carefully consider your current and future living expenses so you’ll be assured you can repay your loan and maintain the quality of lifestyle you’ll require.
One of the biggest initial outlays you’ll face is your deposit. This is usually 10 per cent of the purchase price
but don’t forget that the deposit, like many elements of a property purchase, can be negotiated. It’s not uncommon for a property owner to consider a 5 per cent deposit in some circumstances, so don’t be afraid to ask your agent if your funds are stretched.
In addition to the purchase price of your property, you will need to pay for things like Stamp Duty (on the purchase price and the loan amount borrowed), conveyancing fees and possibly the above mentioned mortgage insurance (if your deposit is less than 20 per cent).
If you’re buying your first home, you may be entitled to valuable grants or bonuses from your State Government. To find out, visit firstnational.com.au and type ‘First Home Owner Grant’ in the search bar.