First home buyer checklist
To make your life easy, we’ve broken down the guide into four steps so you can check in with it no matter what stage of the process you're at.
Getting organised
☐ Let’s start at the very beginning – set up a budget
Get into good habits when it comes to your spending and saving. This will help you save your deposit faster and prepare you for having to meet loan repayments and expenses when you become a homeowner. You might cut your spending by taking public transport to work or skipping your daily 3pm servo snack. If you need help creating a budget, we have tools available, like mymo by BCU.
☐ Time to get serious about saving
Start by opening a separate account for your home loan deposit savings. Once you’ve got that, you can set a realistic goal for how much you can afford to save each week, fortnight or month. It is possible to keep doing what you love if you have a great budget in place – it will help you find a happy medium when it comes to spending and saving.
☐ Find out what you can afford to borrow
Make sure purchasing a property is a commitment you can afford in the long term. See how much you may be able to borrow for your first home with our handy home loan borrowing power calculator.
☐ Work out how much of a deposit you need
The bigger the deposit you can put down, the better. As a general rule, you need between 5% and 20% of the property purchase price as a deposit to be eligible for a home loan. With a deposit less than 20% you’ll also need to pay Lender’s Mortgage Insurance (LMI), unless you have parents or relatives to be guarantors.
☐ Look into government grants and guarantees
There are several government grants and schemes that you may be eligible for as a first home buyer. You could save thousands so take the time to find out if you qualify for any of them. More information about grants available in NSW and QLD is available on our blog.
☐ Know what it costs
As well as the purchase price, there are other costs you’ll need to consider when buying your first home. These can include stamp duty, moving expenses and settlement fees. Make sure you're aware of what’s in store so you don’t end up short, or looking at homes outside your budget.
☐ Look at home loan options
Fixed rate or variable home loan? Weigh up the pros and cons of each loan type, then decide which option suits you the best.
Psst! While you're here, take a look at our home loans.
☐ Speak to an expert
There are professionals who can help you through every step of the home buying journey, whether that’s a mortgage broker or dealing with a lender directly. BCU Bank can support you through the lending process, with mobile lenders who can visit you at home, your workplace, or even your favourite cafe, and lending specialists in our branches.
Find your property match
☐ Research, research, research
Now that you have a rough idea of how much you can probably afford, it’s time to do some research on the housing market. Get a better idea of suburbs, what’s on offer, and how long properties are on the market for before selling.
☐ What type of property dp you want?
Are you thinking of building or buying something established you can renovate? Do you prefer a townhouse, villa, or apartment? This is a great time to chat to your friends and fam about what might suit you best, especially if they’ve bought before and have advice.
☐ Create your suburb wish list
Top things to think about when you’re comparing suburbs are local schools and public transport options, as well as general affordability and the area’s safety. You can get a free property report for any property on our website, or you can visit real estate websites for local property insights.
☐ Now to be nosey
By visiting open homes you can get a feel for the type of properties you’re interested in and if they will suit you and your lifestyle. Plus, it’s kind of fun to mentally decorate your potential new home!
☐ Preparation is key
Get pre-approval for a home loan so you’re ready to submit an offer when you find your perfect home. In fast moving markets, real estate agents often request that buyers have pre-approval before making an offer because it shows who is serious about purchasing and also gives the seller confidence when they have multiple offers on the table. Read more about home loan pre-approval.
Contracts to settlement
☐ It’s offer time
Once you’ve found the property you want to buy, it’s time to make an offer. Most homes are sold through an offer and acceptance (O&A) process. This involves making a formal offer in writing and the owner/seller either accepting, rejecting or making a counteroffer – in that case, be ready to negotiate!
☐ Sold!
If your offer is accepted, you will then go through the settlement process. This is the part where the seller passes ownership of the property to the buyer. It’s also when your finance approval will take place, and you’ll pay the sale balance. You can either appoint a settlement agent, or the real estate agent will recommend one for you.
The settlement agent will prepare the legal documents and provide advice for the property transaction. Settlement usually takes between 30-90 days and depends on the agreement made between the seller and real estate agent.
☐ Remember the other costs?
As mentioned, there are a range of costs, such as council and water rates, valuations and mortgage registration that will be included in the settlement and finance process. This is also the perfect time to arrange building and pest inspections to ensure everything is in order with the property before the sale is finalised.
☐ Sign on the dotted line
Your settlement agent will work with your home loan lender to arrange the final costs and your total loan amount. At this stage you have to sign your loan contract.
☐ Protect your biggest asset
Protect your property and possessions with home and contents insurance. If you’re buying a unit or strata dwelling, the building insurance may already be included, but always check to be safe. To estimate how much insurance cover you’ll need, use a home contents value calculator and a home buildings value calculator.
☐ Signed, sealed, and delivered
When you reach final settlement, your mortgage will be held at the bank and lodged with the government. Congratulations! This is the last official step in making your home ownership dream come true.
Movin' time
☐ Get connected
Before you move into your new home, contact the relevant providers to connect the utilities you need. This could include water, electricity, gas, a phone line or internet connection. It'll feel more like home if everything works when you move in – even if it does mean watching Binge on your phone from a mattress on the floor!
☐ Shopping time
To save on the cost of furnishing your new pad, you can look for sales, second-hand pieces, or ask for hand-me-downs from family or friends. You don’t need to rush into buying everything straight away (as tempting as it is) so take your time to settle in and see what works for you before spending big.
☐ I like to move it, move it
When it comes to moving, do as much of it yourself as you can to save some money. Bribe your mates with a BBQ or beg your family to help you shift! If that doesn't work, hire a moving truck or get the professional removalists involved.
Moving day can be long and tiring so get all the help you can – even if that is just a babysitter to mind the kids, or someone to watch your pets! That way when it's time to unpack, you don't have to worry about keeping an eye on anything other than your boxes.
☐ Update your address
Make sure you change your address so you don't miss anything important. You can redirect your mail through Australia Post, but remember to update key forms of identity, like Medicare and your driver's licence. You’ll also need to update all your service providers with your new address, such as your banks, insurers and mobile network.
☐ Celebrate good times!
After all that, and you’re finally in your home it’s time to sit back, relax, and enjoy being an official homeowner.
