We all love a check-list (note financial geek here) but you’ll find a checklist is a great way to make sure you have all you need before applying for a home loan. So here they are:
1. Get a hold of your credit file/score. It’s a fairly straight forward application on https://www.finder.com.au/credit-score and it’s FREE. Knowing your credit score will help you determine your list of lenders.
2. Organise and prepare your paperwork. This one sounds like a no-brainer but it’s amazing the amount of people who don’t do this. Applying for a loan is very straight forward IF all the paperwork has already been collated.
3. Start saving now. Lenders love to see a rainy day kitty looking healthy as it makes you look less of a risk for them.
4. Look at re-financing, this is a great way to free up some cash and make your disposable income look healthier which lenders LOVE.
5. Compare lenders before you decide. There are loads of loan comparison sites like www.canstar.com.au. Be warned of some of the extras than come with a lower variable interest rates, for example, high exit fees, high management fees that essentially cancel out the interest rate savings.
6. Don’t quit your job or start a new business. It makes you look riskier to a lender and they don’t like risk!
7. Pay all your bills on-time. Did you know that even an overdue (not even a demand letter) on your council rates can end in a negative decision from a lender?
8. Reduce the limits on your existing credit cards. Lenders look at credit available to you and not just what debt you actually have to lower them to a decent and comfortable level in line with your budget.
9. Check if you are eligible for any concessions like a first home buyer grant or a stamp duty exemption depending if you’re an investor or if you’re buying an existing or a new dwelling.
10. Speak to a professional, that’s right. Call me and I’ll walk you through it!