The excitement of buying your 1st home can often be tinged with uncertainty and nervousness, which is why its important to get all the fact right from the beginning. Your main focus should be finding the property that best suits your needs and budget.
My role will be to make the process as simple and easy as possible by helping you through all the steps.
As part of my process, I will cover the following:-
Help you to establish your borrowing capacity
Identify all the costs associated with buying your first home
Determine the maximum LVR (loan to value ratio) that you can be approved up to
Help you understand how much deposit you will require
Clarify exactly which Government grants and benefits you qualify for
Assist you with applying for any applicable grants
Explain the home buying process from start to settlement
I guarantee that I will make your journey as easy and enjoyable as possible!
When you’ve been through it all before, you probably have a pretty good idea of what a headache organising your home loan can be.
A common scenario I come across is when a client wants to keep their existing home and buy a new one. The idea being they will rent out the existing property and this will become an investment property.
Here are the common themes to this scenario and they deserve careful consideration before making a decision either way:-
If you borrow money using the equity in your current property to purchase a new home, then you will need to borrow the full purchase price plus all associated costs (unless you have other cash to contribute). i.e. you will be borrowing 105% of the purchase price as a guide (allowing 5% for costs). The loan remaining on the existing property becomes tax deductible once that property becomes an investment property as is rented out.
The new mortgage, which is not tax deductible for example, would be $630k assuming a $600k purchase. You are left paying the higher debt from your post tax income, whilst the smaller debt left on the investment property becomes deductible (assuming you have reduced your mortgage
Ideally you would want to have this situation the other way round, with the higher debt on the investment property. It comes down to cashflow. When you sell, you have the cash to put towards the new home, taking a smaller non-deductible loan and thereby reducing your loan repayments. You will then have the option of putting the remaining equity into another investment, which then all the costs i.e. 105% of the new purchase would be classified as deductible or ‘good debt’.
Good debt simply means you are making more money that you are paying and using leverage to increase your wealth.
There are many reasons to review your home loans and see how you can save thousands over a longer term. The mortgage market is very competitive at the moment – do you know what your interest rate is? When was the last time you took the time to review your current home loan? Did you know that most people are too busy with their personal lives to spend time reviewing their loan? This is a great time to look at the many innovative options and competitive interest rates being offered.
Maybe your personal situation has changed and you need to consolidate your high interest personal debt that is weighing you down, to a lower interest repayment.
I have multiple lenders competing for your business so it’s a great way to ensure the best rate for your personal situation.