If one of your New Year’s resolutions is to buy a home in 2018, there are steps you can take to make it a reality.
The summer months of holidays and happiness are a perfect time to devote some time to house-hunting to help you hit the ground running as potential home-owners in the new calendar year.
Whether you need to organise your finances to save money, find a trusted real estate agent, or a professional mortgage broker there are lots of things to keep you busy.
4 Ways to Prepare For a Home Loan
To help you take a step in the right direction, try these 4 tips to be prepared.
1. Check your credit score
If you’ve never borrowed money before, you might not know the state of your credit rating but by engaging with an experienced mortgage broker, you can find out how you fare and, based on that, you may have a range of lender options open to you.
Paying bills on time and not having any outstanding bad debts helps your credit score be a positive one. Be honest with the paperwork you fill in and get the right advice from a finance broking specialist who understands the loan application process.
Having a great credit rating opens lots of doors for potential home loans but, even if your credit rating is not perfect, a broker may still help you find a lender who can look after your home loan needs.
2. Plan A Budget
Once you understand your lending power, based on your current income level and expenses, you can plan a budget that you can stick to – with a strategy that ensures you manage your loan repayments without stress.
Crunching your household numbers by understanding what’s coming in and what has to go out is critical to staying on top of your mortgage repayments – and even getting ahead for greater savings in the long-term.
3. Stay up-to-date with interest rates
Being informed is always good and if you have a great relationship with an experienced broker, they will keep you up to date on rate changes that may impact your ongoing home loan repayment expenses. Choosing the best possible interest rate that suits your needs is always a good start but along the way, you can shop around for a better rate and refinance – and that can save you thousands over the life of your home loan. But be realistic. Just because the media reports that interest rates are at all all-time low, your own personal financial circumstances might make it difficult for you to access those rates. The better your credit rating, the more bargaining power you have with any lender.
Choosing a home loan is a serious business so be sure to do it with the right advice and support.
4. Get pre-approval
Being pre-approved for a home loan gives you the confidence and freedom to start your house-hunting in earnest. Preparing your loan application documents and settling on a lender with a competitive interest rate that works for your budget helps you understand what you can afford to spend on the home of your dreams. And remember – dreams do change and grow as you do. Having your heart set on that mansion in the inner-suburbs might not be in your budget now but that doesn’t mean that you can’t find another alternative to get your foot in the property door for a happy new year that gives you stability, security and access to an asset that will help you create a long-term investment you’ll call home.
To find out more about preparing for a Home Loan, talk to our team at Lending Specialists on 03 8805 1800.