As a pharmacy assistant, buying your first home might feel overwhelming with all the different loan options, government schemes, and financial requirements to consider. Understanding the resources available specifically for first-time buyers can make a significant difference in your journey to homeownership.
Understanding Your Borrowing Capacity
Before you start looking at properties, it's crucial to understand your borrowing capacity. Lenders will assess your financial situation by examining several factors:
• Your income and employment stability as a pharmacy assistant
• Monthly expenses and existing debts
• Bank statements from the past three to six months
• Credit history and repayment behaviour
Your borrowing capacity determines the loan amount you can access, which directly impacts the price range of properties you can consider in the current property market.
Government Support for First-Time Buyers
The Australian government offers several first time home buyer programs designed to make homeownership more accessible:
First Home Owner Grants (FHOG)
Most states and territories provide first home owner grants ranging from $10,000 to $25,000 AUD. These grants help reduce the upfront costs associated with buying a home.
Home Guarantee Scheme
This federal initiative allows eligible first-time buyers to purchase a home with as little as a 5% deposit. The government acts as guarantor for up to 15% of the property value, helping you avoid lenders mortgage insurance (LMI).
Stamp Duty Concessions
Many states offer stamp duty reductions or exemptions for first-time buyers, potentially saving thousands of dollars on your purchase.
Ready to get started?
Book a chat with a Finance & Mortgage Broker at Pharmacist Home Loans today.
Loan Types and Interest Rate Options
When applying for a home loan, you'll encounter various interest rate structures:
Variable Interest Rate
These rates fluctuate with market conditions and lender policies. While they can increase, they also have the potential to decrease, and often come with features like offset accounts.
Fixed Interest Rate
Fixed rates remain constant for a set period, typically one to five years. This provides certainty in your repayments but may not benefit from rate decreases.
Split Loans
Some borrowers choose to split their loan between fixed and variable portions to balance security and flexibility.
Understanding Loan to Value Ratio (LVR)
The loan to value ratio represents the percentage of the property's value you're borrowing. For example, if you're purchasing a $500,000 AUD property with a $50,000 AUD deposit, your LVR would be 90%.
Typically, if your LVR exceeds 80%, you'll need to pay lenders mortgage insurance (LMI). However, first time home buyer schemes like the Home Guarantee Scheme can help you avoid this additional cost.
Working with Mortgage Brokers
Mortgage brokers can provide access to home loan options from banks and lenders across Australia. This access to banks and lenders nationwide means you're not limited to just one institution's products. Benefits of working with a specialist broker include:
• Comparison of different loan packages and interest rate discounts
• Assistance with the application process
• Support in getting pre-approved for your first home loan
• Guidance through the streamlined application process
Preparing Your Application
To apply for a home loan successfully, ensure you have:
- Recent payslips and employment contracts
- Bank statements covering at least three months
- Tax returns and group certificates
- Details of any existing debts or financial commitments
- Identification documents
Being well-prepared can significantly speed up your application process and improve your chances of approval.
Additional Features to Consider
When comparing home loans, consider these features that could benefit your financial situation:
Offset Account
An offset account links to your home loan and can reduce the interest you pay. Any funds in this account offset against your loan balance for interest calculation purposes.
Redraw Facility
This allows you to access any extra repayments you've made on your loan, providing financial flexibility.
Planning for Future Investment
While focusing on your first home loan, it's worth understanding that many lenders also offer investment loan options. Some pharmacy assistants later consider purchasing their first investment property, and having established a relationship with lenders can streamline future investment loan applications.
Taking the Next Step
Buying your first home is a significant milestone, and having the right information and support makes the process more manageable. Understanding the various government schemes, loan types, and application requirements puts you in a stronger position to secure suitable financing for your property purchase.
Call one of our team or book an appointment at a time that works for you to discuss your specific circumstances and explore the home loan options available to you as a pharmacy assistant.
