Buying your first home?
Buying your first home can often feel challenging, particularly for younger people. The average age of first home buyers has increased to 35 to 44 years of age with a number being married with children before they can afford to purchase. What is driving this? Analysts suggest that affordability is having a major impact on the capacity to purchase. Whilst we have been used to seeing first home buyers in their mid 20’s purchasing this is now a rarity. So what can you do to accelerate purchasing your first home?
Save for it
If you are not putting money into savings each pay, start doing it! It all adds up. Lenders require you to show genuine savings to obtain a home loan. Even if you are receiving a guarantee or gift towards a deposit you still have to show capacity to save. Savings should represent approximately 10% of your pre tax income. This will show your lender that you are serious about buying your first home and that you are able to service your debt. If you are struggling to save this amount there are some additional areas you can do to isolate where the changes need to come from.
Take a 28-day financial challenge.
For 28 days write down in a notebook or get an app that records your expenses and record them for a month. After 28 days take a look at your expenses. Can you make any changes? What if you didn’t have that take away coffee each day? How much would you save? Believe it or not 1 coffee a day will equal nearly $20 per week. Get a keep cup and take it from home and save those extra dollars.
Get rid of your credit card debt.
Consider transferring the debt from your existing credit card to an interest free grace period credit card for a period of time and pay down the debt. Credit card interest rates range from 0% to 20%. With a $5000 debt at 10% on minimum payments it will cost you $8116. Although if you increase your payments will result in you paying $5492 over the repayment period saving you over $2600.
Build the dream.
You don’t have to have it all for your first purchase. Buy property that you can renovate over time or look at alternatives to your dream suburb. Scale down the size so you can afford the area you want. There are many options and sometimes compromise may be needed to get you in.
Talk to Juro Financial Services about your purchase
We will work with you through the pre approval process to avoid the stress of waiting for approval to come through when you find your dream home. Pre approval before you buy allows you to understand what the bank will lend you and how much you can afford. We can walk you through the process and as a Finance Broker have the ability to tailor the loan to your needs. Contact us today at Juro Financial Services on 0432 391 504.