First home buyers are often seen as vulnerable because it is the first time they are buying a home so they are especially prone to being ripped off by bad finance sources who are just looking out for their best interests. If at any stage you come across a housing or finance term that you are not familiar with in this article, please do a quick search on google or yahoo to find out the meaning, it will help tremendously. Alternately go to the website at the bottom of this article and go to the glossary page.
A few areas that will be covered to help first home buyers with their first home loan will include; the type of borrower you are and the finance sources. There is also a buyer s checklist able to be downloaded and a home loan calculator link. These topics merely scratch the surface of what is involved. It is recommended that you consult a mortgage broker or another finance source to fully inform you of what is involved when getting your first home loan.
Type of borrower
There are a few different types of home buyers which make up this category. The main three that will be accounted for in this article are; investment buyers, non-conforming buyers and first home buyers.
Investment home buyers
This particular group of buyers already own, or are paying off, some form of property already. They may have been handed down land or property by their parents or relatives or have purchased or used equity in previous properties or land to make further purchases.
Because they have existing property, banks and mortgage brokers are able to source finance a lot quicker and easier, because they have collateral behind them (which is like a security back up in case their finances go bad for the second or third property purchase).
Non conforming home buyers
Non conforming home loans are basically designed for finance for those people who may be in unusual situations with how their income is paid or how they wish to finance their home loan or mortgage. Non conforming borrowers are also people who may have been previously rejected for a home loan for a number of reasons such as bad credit history, bankruptcy or unusual incomes (more information on non conforming areas below).
Banks are normally quite reluctant to approve mortgages for those that fit into the non conforming loan borrower and people often find that their first standard loan application is rejected by the banks.
First home buyers
Buying your first home is without doubt one of the biggest and most exciting purchases you will ever make.
There are many incentives available to first home buyers in Australia, including the first home buyer s grant, which is $7,000. In addition there is also the option of having no stamp duty on your purchase.
As with all things there are conditions attached.
How much can you borrow?
Using a home loan calculator can help give you a rough idea about how much you can borrow. Don t be disheartened if it is not as much as you initially hoped for, it is a rough calculation. For an accurate assessment contact a mortgage broker or other financial source to get further information.
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