FAQs
Got questions? We’ve got answers. Take a look at our Frequently Asked Questions to get quick and clear information on everything you need to know about the home loan process.
Buying Your First Home, Essentials and Preparations
Most lenders require a deposit of at least 10-20% of the property’s value. A larger deposit can help you avoid Lenders Mortgage Insurance (LMI) and may improve your chances of loan approval.
Start by setting a savings goal, creating a budget, automating your savings, reducing non-essential spending and exploring government grants like the First Home Owner Grant (FHOG) to boost your savings. To get your budgeting on track, download the MFL app.
In addition to the deposit, you’ll need to budget for stamp duty, Lenders Mortgage Insurance (LMI) (if applicable), legal fees, building and pest inspections, and moving costs.
On average, it takes around 4-5 years to save for a deposit, depending on your income, expenses and savings habits. A detailed budget and disciplined savings plan can help reduce this timeline.
Start by assessing your financial situation, saving a deposit, checking your credit score, reducing debt, gathering documentation (payslips, bank statements) and getting pre-approval from a lender.
To escape the rental trap, start by setting a savings goal, cutting back on expenses, boosting your income and exploring government grants. You may also consider moving to a more affordable rental or sharing costs with housemates while you save.
It depends on market conditions, interest rates and your financial readiness. If interest rates are low and you have a stable income, it could be a good time to buy. Research the market and consult with a mortgage broker for personalised advice.
Grants like the First Home Owner Grant (FHOG) and stamp duty concessions are available to help first home buyers. You may also be eligible for the First Home Super Saver Scheme (FHSSS), which allows you to save for a deposit through your super fund.
Financial Strategies for Home Buying
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
Navigating the Home Loan Process
You’ll typically need LMI if your deposit is less than 20% of the property’s value. LMI protects the lender if you default on the loan, but the cost is passed on to you.
A fixed-rate loan provides stable repayments for a set period, while a variable-rate loan offers flexibility and the potential to benefit from interest rate decreases. Your choice depends on your financial situation and risk tolerance.
Pre-approval gives you a clear idea of how much you can borrow and strengthens your position when making offers on properties. It also speeds up the buying process and reduces stress.
The First Home Buyer’s Checklist includes steps like determining your budget, saving for a deposit, checking your credit score, getting pre-approval, hiring a conveyancer, arranging inspections and planning for settlement day.
To improve your chances, build a strong credit score, save a larger deposit, reduce your debt-to-income ratio, provide proof of stable income and get pre-approval before house hunting.
New homes offer modern features, energy efficiency and lower maintenance, while established homes often have lower purchase prices, established neighbourhoods and greater potential for value appreciation. Your decision depends on your preferences and budget.
Family Support and Long-Term Considerations
A family guarantee involves a family member, usually a parent, offering their property as additional security for your loan. This can help you secure a loan with a smaller deposit, avoid Lenders Mortgage Insurance (LMI) and enter the property market sooner.
You can exit a family guarantee by refinancing your home loan once you’ve built up enough equity, typically when your loan-to-value ratio (LVR) drops below 80%. This releases your guarantor from their obligations.
Parents can help by offering a family guarantee, using the equity in their property as security for their child’s loan, helping them avoid Lenders Mortgage Insurance (LMI) and securing a loan with a smaller deposit.
Renting involves paying a landlord to live in a property, whereas owning a home allows you to build equity and invest in your future. Owning provides stability and the potential for property appreciation, but also comes with responsibilities like maintenance and mortgage repayments.
Create a new budget, build an emergency fund, prioritise mortgage repayments, plan for ongoing maintenance and regularly review your home loan to ensure you’re getting the best deal.
It’s normal to feel emotional, but it’s important to stay objective. Set a firm budget, avoid overcommitting and seek advice from professionals like mortgage brokers and real estate agents to make informed decisions.
Your Guide to Affordable Homeownership
1
Meet Your Coach
Let us pair you with a dedicated home loan coach. They’ll provide guidance to help you through the home buying process.
2
Create a Savings Plan
Your coach will estimate your borrowing power and provide budgeting advice, made easy with our My First Track app, so you can save confidently for your new home.
3
Get Your Loan
When you're ready, apply for and secure the loan you need to purchase your first home.
