Save for a home deposit
our first step before entering into the property market should be saving towards a deposit.
A deposit is very important as it gives potential home buyers the boost they need when applying for a home loan
If you have a deposit to put down, the Banks will take this into account and your affordability score will rise.
Additionally, your monthly home loan repayments will be lowered and depending on the relevant Bank’s criteria, you could be able to apply for a higher bond if you wish.
Saving towards a deposit is a simple concept although it can seem difficult depending on your financial situation.
However, it is like any investment plan; it takes time and patience. Start by drawing up a budget of your monthly expenses and deciding how much you can afford to save per month.
You may have to make cutbacks on certain items, but in the end being able to put down a deposit will result in lower instalments and less interest over the loan period, making paying off your loan more manageable.
Budgeting tip: A general guideline is to aim to have 8% of the property value available as this will likely cover registration costs.